1/

It's funny when I have called some cos to reflect a ~65 pricing for example in the recent top, the counter argument has been many times that they are trading at a huge discount to the project NAV or NPV. How many of these ppl have actually done dcf analysis by themselves?
2/

Depending on when these studies have been released and what parameters they have used, I think Kevin knows his stuff. Typically 1.5x to 2.5x is a reasonable factor to capex.
3/

Opex is affected by currency exchange rates, energy prices, labour availability and price among other things. Are these at par on how you see world going from here? Typically use growth rate for costs.
4/

The product price might actually be the easiest thing to estimate in a NPV .
5/

Time and discount rates are huge factors in valuation. Typically add few years and use basic rate 8% to all, for comparison purposes.
6/

If a company NPV/NAV is robust through a proper sensitivity analysis, you are on to something.
7/

Sure, valuation might not matter. It's most likely that we will overshoot all the valuations there are. Is cash flow or earnings valuation useless then? Well, thats up to you to decide. I think it has its place.

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More from @tepuuma

2 Oct
1/

Some thoughts of my investment plan in #uranium.

My plan calls for some intra-sector rotation once the cycle starts to heat up.

There are some plays that will outrun others, for various reasons, some being the narrative, history & expectation probability.
2/

There are many equities that fit at least two of these categories, but at least $PDN is one that fits all of these three.

What do you think could be one?
3/

I've already started the rotation from this cooling period, where many have corrected 30-50% from the recent peak. I'm not selling any here, but rather use some margin and/or rotation from other assets to buy.

I will finance this when I see over extension the next time.
Read 8 tweets
2 Oct
At the end, the only commodity we REALLY need is food. What value does gold have, if both ends of the value chain are hungry? One needs to remember that there is someone out there, who will choose a piece of bread over a piece of gold.
Supply chain of food relies heavily on energy. Rising energy price puts high pressure on primary producers of which many are already producing on thin margins. The rising price of food does not increase their profits, at least not at once, because many have long term contracts...
...that define the price levels. There are also many middleman between the producer and end user, who willingly take their part.
Read 6 tweets
29 Sep
"90% of the gains occur within the last 10%."

1/

Case study $PDN $PDN.ax $PALAF #uranium #investing @quakes99
2/

Total cycle Decile returns of Paladin Energy Apr 2003 to Apr 2007
3/

Isolated decile returns and cumulative return of Paladin Energy Apr 2003 - Apr 2007
Read 6 tweets
23 Sep
1/

At any given moment in a market cycle it can be very educational to think, who and with what goals does the current action benefit the most?

#uranium #SPUT #u308 #investing
2/

We just had extended highs as the SPUT caused the spot rise through the feedback loop. As the SPUT lost the premium, due whatever reason, the rally stalled and started losing steam causing a reverse in equities.
3/

After the highs, think who distributes and who accumulates, and on which side of the market, physical or equities?
Read 10 tweets
21 Sep
1/7

Got a few DMs I'd like to address as a thread here.

Recent ~30% selloff shaved the valuation base to an average of ~60$/lb. pricing for #uranium equities on average from the +65$/lb pricing. Same kind of shave from here would bring majority to value with the spot.
2/7

Now, it looks obvious that market is anticipating SPUT to buy lbs and thus put pressure on rising the spot. If it doesn't, like soon, the overvaluation on equities continue to level down. Euphoria needs to be fed.
3/7

SPUT is the flick of the switch here. Broad market direction either dampens or accelerates the following movement.
Read 7 tweets
19 Sep
Now there is almost no production which naturally affects how we should compare the market caps of different eras. The cash flow from #uranium mining itself is almost null. Also, many equities have retraced 20% or more from the peak market valuation already, which has brought...
...the market valuation closer to the realized spot price.

Market cap of the sector also reacts in a shape of an S-curve rather than linear line, as the economics of the projects get significantly better at a certain price range. The exponential part of the journey is still...
...ahead of us, which seems unbelievable at this point where we can see ten multiples of revaluation in some of the equities already. Which is exactly why #uranium is THE investment opportunity of a life time.
Read 7 tweets

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