Cycle Bottom Profile picture
Mar 5 4 tweets 2 min read
#AuraEnergy incoming Tiris NPV upgrade > 150% & Sweden pro-mining move adds an NPV > 10x the current cap back into the mix.

Which #uranium stock has a resource over 850mlbs and is trading at less than US$140m?

$AEE
The Tiris NPV will scale up to > US$1.2bn over 5years due to nearology.

Haggan NPV will be US$2-5bn over the next 7 years with full credits included.

Cap US$140m
2025 NPV $2.0bn
2027 NPV $3.5bn
2029 NPV $5.0bn

$AEE
No high risk exploration drilling required, just execution of Tiris into production, followed by moving Haggen to the DFS project level.
Relative outperformance: $AEE -14%

Under exposed, Low cost pre-production #uranium play outperforms in down market conditions.

Look at where your favorite #uranium stocks have performed relatively?

Many down greater than 50%

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More from @BULLReturns

Mar 5
Thought of the day: Return compounding is all about timeframes in #cyclicals, 10x over 5 years reinvested in 10x over 5 years reinvested in 10x over 5 years with 1-2 year waiting between reinvestment = 1000x over 17-19 years. Are you formulating your compounding plan?
Our working example:

$BTU from $1.21 = 13x < 30 months

deployed into:

$IREN from $1.32 = expect 10x over 48 months

deployed into:

Unknown at this time = 8x

Total return = >1000x
Documented is previous tweets
Read 7 tweets
Feb 19
Thought of the day: The biggest mistake of 90% of investors, is to overtrade (our guidance is not to trade, but to invest, sitting being the most important element), therefore missing 65% of the returns that simple cycle bottom & reversion to the mean investing delivers.
Let's review an Asymmetric trade in play: $RIG

65c low moving to $15 high (overshot potential to $25 = > 20x

Holding time: 4-7yrs = sitting

Likely 50% plus draw downs within the holding period: 3-4

Day rates: < $200k to over > $700k
Capacity Utilization: <50% to >97%
How reversion to the mean works? $RIG
- sector cyclical low 2H 2020, 10yr plus low
- low new sector capacity
- cashflow momentum increasing due to capacity & day rate increases
- sector positive coverage increases, new players enter the stock from $4 indicating > $20 recovery
Read 10 tweets
Feb 17
The key pleasing point is the new staff additions, as this will drive 2Q volume efficiency and expansion.

The pivot back to Met is key given the higher margin opportunity.

Couple these 2 positives = > $50/t margin 2Q-3Q 2023

$AHQ
Regal has a short term positive wave to complete their selling into....

Future dilution is still on the cards.
40-50 new staff at NEM should allow for an additional shift and more than doubling in volumes pushing unit costs down 👇 to below $135/t, 3Q possible?
Read 5 tweets
Feb 14
#AuraEnergy initial #uranium reserve expansion, we expect this to move from 30mlbs to over 70mlb within the next 30 months. In the next few weeks expect the initial substantial lift in NPV as the project capacity increases to 3mlbs and the AISC falls to around $20. $AEE
30mlb reserve NPV at $75 pricing = A$400m or 60c per share

70mlb NPV = A$1.0bn or $1.30 per share

$AEE #uranium
Swedish assets with pro #uranium mining add another $2-5 per share NPV through 2027.

Note the $2 per share value in #molybdenum, #Vanadium, #nickel
And #zinc at current spots alone.

$AEE #auraenergy
Read 6 tweets
Feb 14
Sentiment is dictated by stockprice direction for many, we engage the opportunity view, $15m cap Vs 2027 NPV potential of $2bn, is worth putting in the work, if survivability occurs with moderate dilution then = 20x bagger. Most don't have the stomach for the required work. $AHQ
Likely the major holder Regal is dumping their position, we will see in the filings. 1Q - 2Q 2023 was always the timeframe required to evaluate optimization potential on $AHQ, now it's time to do the work.

With the likelihood of very dilutive cap raise, we are watching this.
Short term selling liquidity = voting machine

Medium Term Liquidity = weighing machine

A great case study on assessing the weighing Vs voting outcome.

Avoid the emotions, do the work, be patience, turnarounds are higher risk than cycle bottoms.
Read 5 tweets
Feb 9
Thought of the day: A lifestyle explorer mining company is something to generally avoid, look for the following characteristics, CEO's earning over $300k, G&A exceeding 25% of annual spend, G&A exceeding 10% of cap. Alignment of interests are key for returns.
In our previous activist wins we faced the following:
- the stupidity of retail believing existing mgmt when G&A exceeds 35% of cap & the CEO receiving up to 18% of cap (top performing fund managers are receiving less than 3% of AUM).
- being attacked by the old mgmt teams
Often if 20-30% of the register votes for positive change, this is often sufficient in bring a stop to lifestyle mining explorers mining retail investors wallets.
Read 4 tweets

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