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Kevin Bambrough

5 Mar, 11 tweets, 2 min read

When I started buying silver it was just under $4/oz and in told my friends that it was free silver. You only had to pay for the cost of deliver from under the ground to you and at that time nearly all producers were willing to do that for you at a loss on an operating basis

They ignored the massive costs past shareholders incured to find, prove up and build their mining infrastructure. They got caught with debt and operational pressures to continue to dig up their assets and sell them even though most made next to nothing on an operating basis

such is mining. They sink massive amounts of others peoples money to find and develop. Geologists dream of finding and developing and mine. And many work on them for a life time. They raise money when they can and spend it quickly to try to bring their dream to life

The disciplines investor waits for the market to collapse. When everyone has written off the capital that has been sunk. We get to buy assets on an operating cash flow basis when commodity prices are low.

So we capitalize on the gains to be had when low prices cure low prices and a shortage emerges. Cash flow explodes and stocks rip to all time highs. It takes a few years and the gains are amazing

But eventually it’s always stupid money pours into the sector and production expansion is over funded. And the price collapses again to a level that only they lowest cost producers can generate positive cash flow.

Luck for us we are in a very good time for commodity investing. Particularly #uranium almost no one makes money even on a cash basis. Mines have expired do to end of life or shut due to higher operating costs

But we have companies like $pdn that spend more (inflation adjusted) on their mining operations than there current market cap. The price of uranium is now certain to explode to $80-100 or higher. Maybe much higher as demand is set to ramp up.

They are permitted, they just need higher prices. Can debt finance the restart when the time is right and become cash flow monsters. 10x 20x 100x from the lows will be had again.

When you understand the commodity investing cycle you can become insanely rich as long as you are patient and exercise discipline. Ignore the noise, do you work. Understand the fundamentals and buy extreme stocks wash out weakness

But to maximize, ignore the chatter about over valuation. Wait for the dumb money, wait for the mania, and most importantly wait and don’t sell a fucking of your favourite stocks until you see enough money pouring into your sector to fund enough new mines to over supply

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More from @BambroughKevin

Kevin Bambrough

@BambroughKevin

4 Mar

#Gold down again but the #HUI don’t care and either do I. $NEM Newmont 4% dividend. Golds stocks are value plays and many with growth. #Gold will be $6000-10000 in 5-10 years. Forget the noise and get long

Again, I laugh when I see short term commentary about gold says deflation coming. In the last 20 years gold has gone from under $300 to $1700 ~6x And the DOW has gone from 10k to 30k 3x. $DJI, $QQQ, $SPX is stupid expensive and full of risk.

If we are gonna have rates actually back up and deflation then then the major indexes will all get at least cut in half. But the catch 222 is...

Read 9 tweets

Kevin Bambrough

@BambroughKevin

3 Mar

As I chat with more and more people I know that we’re all over uranium in the 2003-2007 time period I’m still shocked how under invested they are now.

Also, I don’t care how good any uranium analyst out there thinks they are we are all in the same boat when it comes predicting

No one can model the number of new reactor builds we will have under construction in 5 years and certainly not in 10 years from now. The resurgence in interest surprising nearly everyone now

When we look at the most bullish forecasts for demand growth that have been produced I can’t help out laugh. #uranium demand is gonna blow the market away.

The super bears still control the narrative and pressure and push back on those trying to stick there neck out even a bit

Read 15 tweets

Kevin Bambrough

@BambroughKevin

3 Mar

So, we should get the ASX 300 announcement for $pdn $PALAF 2nd Friday on March (12th) hoping the momentum continues to the announcement and the index fund purchases that will typically take place over the two days following the addition.

But, the real question will this announcement cause a bit of a selling freeze in $PDN and $PALAF as shareholders get excited for the inevitable June addition to the ASX 200. If we get a sellers strike combined with continued Uranium ETF inflows then we will get a melt up!

It’s my belief that $U.TO is likely working to secure physical uranium given its premium to NAV. The market is telling it to buy uranium. They really need to take advantage of this rare opportunity and call a shareholder vote to allow it to borrow and buy as well

Read 9 tweets

Kevin Bambrough

@BambroughKevin

2 Mar

$uranium investing, commodity investing, timing is everything.

You have to told your nose and buy where there are bankruptcies mine closures and a complete lack of interest.

When mines look worthless due to low commodity prices.

When to sell? When you see enough funds entering the sector to restart mines and fund enough new mines that it appears there’s real risk of oversupply coming back.

For the most part I’d the commodity prices is heading higher stocks will continue to do so.

Stocks often will begin to look weak toppy perhaps a few months before the ultimate peak. But usually the two peaks coincide well together.

If your in early then you need not care much about the last 20-30 percent and are likely better off scaling out as your goals are met

Read 7 tweets

Kevin Bambrough

@BambroughKevin

2 Mar

Do me a favour... don’t anyone ever ask me a question again using a 10% discount rate as a measure for evaluating the npv of a mining stock. It just annoys the hell out of me and makes me want to rant

I would love to get a 10 percent rate of return. If I could just get a 7 or even 5 percent rate of return I would not even think of wasting my life looking at stocks. I’d be happy to take my savings and just collect a decent fair return. But that’s not possible

The ultra low interest rates dictated by the central banks as they cater to the aid of the leveraged financial sector force us all to either be speculators or losers

Read 6 tweets

Kevin Bambrough

@BambroughKevin

24 Feb

The Uranium mining sector has been completely starved of funding for a decade. Major mines are shutting down not just because of low prices but many have reached their end of life.

They days of looking at the lowest cost producers as price setters are over

If you a conservative analyst that is setting uranium price targets of $45 or $50 (Some ridiculously are using $35) you are out of your fucking mind and are going to be made to look very foolish in the next year and a half

You don’t just fire up a new uranium mine over night. In fact uranium mines are some of the most difficult mines to permit in the world.

10 year bear markets in any commodity don’t end with a 50 percent price rise.

Read 6 tweets

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