Thread by @UraniumIronman

Couple thoughts #uranium $PDN $PALAF

For views such as this I only ever work in back-of-envelope. Sustaining capex changes / cost inflation, commodity financialisation (blow off top?), mgmt decision to do CR, prognosticating about health of credit markets in '23/'24

Make it nigh impossible for a guy like me to credibly assess cost of debt/equity or unforeseen costs in LH maintenance.
So with fairly draconian cost assumptions and conservative earnings multiple this is where I see $PDN share px for different #uranium contract px's

Now px is A$0.66. "Fairly" valued for a '24 mine restart at $50 ($A0.73). Happy to accumulate here and below if we see more pain in the market (as I expect) because at #uranium U3O8 = USD$80, we may see 4x in the value of the mine. I stop at $120 (conservative by utwit standards)

But I will be long gone by that price (except if we see major geopol blockade via Russia or Kazakh - not formalised yet).

Just a reminder for your sanity. Remember mining is one of the most difficult sectors to invest in - hence I only go one step up in risk curve beyond $CCJ & $KAP and have only minor exposure to explorers. There is no moonshot for #uranium equities without

LT #uranium px outperformance. But in this I have very strong confidence. I am conservative in all speculations by nature (in grad school & living off portfolio distributions, I have to be), so this doesn't add any value for the ~300m lbs $PDN has in their

Michelin / Mount Isa / Manyingee exploration assets. Last cycle these were valued at $5-10 / lbs (and at ~300m pounds... that's an extra market cap or two at current SP). So for all the folks suffering from +50% to -10% this yr in #uranium portfolios

Just remember when financial conditions are constricted the mkt values companies able to create liquidity in their own shares; buybacks, div capitalisation, FCF (and not what Uber's CEO thinks cash flow is). Though 1-2 yrs out for $CCJ and $PDN it will come

For the #uranium mining sector the same way it has for O&G (XLE +41% YTD). Add increasingly +ve sentiment on #nuclear and the absolute necessity of it (in my view) for clean energy goals. Just getting started. #patience