UraMin Inc: Up another 3.79% - Enter the Dragon!

UraMin Incorporated and Red Dragon Resources Corporation have announced that their joint venture winter drilling programme on the Rea Uranium Project in Alberta is encouraging.

While this is nice to hear its not the point!

The point is that UraMin have dangled another possible lucrative carrot in front of their uranium hungry predators. This in our view is part of a well-orchestrated strategy designed to maximise the take over price. There is nothing like a little more tantalising news to encourage the predator to increase their bid.

As shareholders we are enjoying every minute of this Merger and Acquisition activity and look forward to a much higher price for this uranium miner.

RPT Uranium Corporation Up 47.6% in 4 months: Sell

On the 19th February 2007 we bought into RPT Uranium Corporation at $0.42. RPT is now trading at $0.62 as we write for a gain of 47.6% in 4 months. The picture for uranium stocks has not been pretty over the last few months so it is nice to see RPT buck the trend and put on a sparkling performance.

As we can see from the chart the stock price is now a fair way above the 200 Day Moving Average (Red Line) and also note that the technical indicators are at the top of their respective ranges. This could indicate that we are in for some sort of correction so we have decided to sell today and move the cash to the sidelines and watch for a suitable correction. If and when this happens we will re-enter the market and hopefully buy RPT back at cheaper levels. If you prefer to hold then that’s fine, as we believe that RPT will be higher than it is now come the end of the year.

UraMin Inc: Up 11.51% yesterday, It’s Game On!

Most of us could have guessed that Areva, the French nuclear energy group were the likely predator as they own around 5% of UraMin Incorporated.

However we now know that UraMin are not just talking to Areva but there are others in the shadows. A few weeks ago we alluded to the Chinese who were getting ‘closer’ to UraMin Incorporated which may have forced Areva into the take over arena. If the Chinese are still interested then its ringside seats for fight of the week: France verses China! Just assumptions on our part!

We also need to be aware that there could be others waiting in the wings about to pounce, so this situation could develop into a three way fight for possession of UraMin.

Finally, one of these companies is going to come second and gain nothing, but we now know that they are actively looking for a supply of uranium. The question is: Who is likely to be the next take over target?

Should keep the rumour mill active if nothing else.

UraMin Inc: In talks to sell the company

UraMin Incorporated has said today that the company is in talks regarding the possible sale of the company. We do not who the possible buyer is at this moment but the stock of this uranium miner is up $0.52 to $7.48 as we write.

It will be interesting to see how this situation unfolds and also what effect it has on the rest of the uranium mining sector.

Laramide Resources: Where Next?

It would appear that the uncertainty surrounding Queensland politics weighs heavy on this uranium explorer.

From the chart we can see that that Laramide has already fallen from around $16.00 to around $10.00, which is hard for any investor to stomach. We have to admit that we have underestimated the effect of the recent changes in Australian politics. The Labour party have recently voted to open Australia to uranium mining but the final decision is in the hands of the individual states. In Laramide's case we are talking about the state of Queensland where its Westmoreland Project is expected to become the companies flagship. The current Premier of Queensland relies to some extent on the support of the coal mining community and they could view uranium as a competitor. Can it be resolved and how long will it take to get a resolution is this question on everyone’s lips.

We must now watch closely as Laramide certainly looks to be oversold and any sign of a relaxation to the ban on uranium mining in Queensland could well be the ignition to spark this uranium stock back in to life.

Uranium Auctions: The Pace Quickens!

There are two days to watch this week and they are Tuesday and Friday.


On Tuesday, June 12th, Denison Mines via Uranium Participation Corp will receive bids for 125 thousand pounds U3O8 for a June delivery.

On Friday, on June 15th, Nufcor will receive bids for 200 thousand pounds U3O8 and 100 tUF6.

Fresh on the heels of two recent uranium auctions that have pushed the price of uranium up to $138/lb according to TradeTech come another two uranium auctions this week. The excitement builds as we watch the hottest game in town unfold before our very eyes.

Through our mythical comic strip starring Sir Peter Misfit of Gigantum Power Corporation we had arrived at a bid of $137.50/lb for the last auction with Uranium-stocks advising that a bid of $140/lb would be required to secure this elusive precious metal. (As uranium is almost half the price of silver here at uranium-stocks we believe that it should be upgraded to reflect its importance) Back to this week where we are faced with two opportunities to get it wrong! It is interesting to see this metal come to the market as the current holders obviously think it is time to take some money of the table and lock in their paper profits.

To put it into context Uranium Participation has approximately 4.2 million pounds of U3O8 and 1.2 million Kg of UF6 or Uranium Hexafluoride. So in percentage terms they are selling 125 thousand pounds U3O8 from their stockpile of 4.2 million pounds, which is approximately 2.9%. We see this as a reasonable move to lock in some paper profits along the way but we do not see it as having a major effect on the price of uranium.

We will keep you informed as and when developments become apparent next week and may we suggest that we could be looking at $150/lb some time next week. As for uranium stocks we are not selling but holding and looking for possible bargains during the summer doldrums.

For disclosure purposes we need to remind you that we do hold shares in Uranium Participation.

Uranium Stocks: Hit by a sell off!

A few days back one of our readers sent us this missive message regarding the sell off of uranium stocks at a time when the underlying asset has almost doubled in price this year. Since then most of these stocks have continued to go down.

I looked on the tsx.com this morning and did some quick math.
Even though this is all CAD and rough %
the theme is the same - Down - Down roughly 7% to 42%
Most hit their high in April - May
even though Uranium is up @ 13% since then
looks like sell in May and go away has been proven again

What great news do you have to change this over sold trend around?

Even if the Uranium price gets to 150.00 by the end of the year
that is only @ 8% higher than today

Looking forward to your comments.

I just picked a few of the larger Uranium Companies.

Powertech Uranium Corp. (PWE) 4.50 High
Current 2.90 down 35% from high

Denison Mines Corp. (DML) 16.57 High
Current 13.90 down 16% from high

UraMin Inc. (UMN) 7.39 High
Current 6.86 down 7% from high

Strathmore Minerals Corp. (STM) 5.50 High
Current 4.59 down 16% from high

Mega Uranium Ltd. (MGA) 8.98 High
Current 6.19 down 31% from high

Laramide Resources Ltd. (LAM) 16.70 High
Current 10.72 down 35% from high

Ur-Energy Inc. (URE) 5.45 High
Current 4.33 down 20% from high

Forsys Metals Corp. (FSY) 10.20 High
Current 5.91 down 42% from high

SXR Uranium One Inc. (SXR) 18.65 High
Current 15.54 down 16% from high

Aurora Energy Resources Inc. (AXU) 20.09 High
Current 18.30 down 8% from high

The reader raises the question about what good news we might have to reverse this over sold trend. The truth is that we have no secret, inside or magical information that we can bring to this party and reverse the current trend. We hear a lot about the negative sentiment that is currently rampant in the gold market with all but a few dumping their gold stocks. Has this negativity transcended market sectors and landed in our little corner of the market? It certainly looks as though the summer selling is being applied across the board regardless of Net Asset Values, future potential or the underlying of value of a companies asset. This is a tough time to be holding uranium stocks especially if you have recently entered this sector only to see your stocks get cheaper by the day. Those with stocks showing a profit may want to lock those profits in and those showing a loss may want to cut their losses, both situations are understandable.



In any Bull Market there is always a wall of worry to climb and this is no different in that respect and we are faced with it right now. However we tend to think of this way for better or for worse. Firstly the people who have sold now have to decide when to re-enter this market and re-enter they will as the vast majority of them have made a profit out of their recent skirmishes. Secondly, with the price of uranium at these levels the companies who have discovered uranium are now looking at fabulous profits bearing in mind that it costs some of them around $20/lb to $30/lb to recover it. As the uncovering of this sector continues more new players will be attracted to it bringing new money to a still small investment arena. Throw in some merger activity and a few hostile takeovers to attract the spot light and we will be back in business. Not to mention a disruption of the oil supplies either by terrorist activity or by those that have it using it as a weapon for economic or political leverage.

Finally our intention for what it is worth is sit through this period and sell none of our uranium stocks even if these clouds persist for most of the summer as sooner or later the value of these stocks will be recognised and this sector will move very quickly indeed.

If you have an opinion on this issue then please send it in, as we will print it even if it is directly opposite to what we think, your insights will add balance to the debate and be of value to all of our readers. Incidentally our readership is growing every day along with the number of subscribers to our newsletter. If you have not subscribed to our letter please do so, it is free of charge and you will be alerted whenever we post a new article on our web site.

Be brave today.

Mega Uranium eyes more Australian acquisitions

Mega Uranium Limited has $112 million set aside for uranium acquisitions, with Australian companies featuring close to the top of the list.

Having acquired two Australian companies (Hindmarsh Resources Limited and Redport Limited last year, director Tony Grey said "I consider that Australia is still the best place in the world for uranium exploration, particularly in the Pine Creek Geosyncline in the Northern Territory," he told delegates at the Association of Mining and Exploration Companies conference in Perth.

As we know MGA is on a mission to become one of the worlds major players in the uranium-mining sector and they know how to do the business on the acquisition trail.

Mr Grey also highlighted Australia’s split political situation whereby Western Australia and Queensland still oppose the mining of uranium and that they could well miss out while the other states reap the benefit of mining uranium.
It will be interesting to watch this situation unfold and for what it is worth our money is on Queensland and Western Australia changing their stance in the near future. As we wrote back in July 2006 “My bet is that they won’t let politics get in the way of a good money spinning deal” in an article entitled ‘Mega Uranium: A Place in the sun’

Taking a quick look at the chart we can see that Mega has come back from a peak of $9.00 to trade close on $6.15 as we write. It is also getting close to its own 200DMA, which it hardly ever goes below.

Chart:



Is this a buying opportunity staring us in the face you ask? We think that it is and we will now watch closely for an entry point.

Uranium Price Predictions?

Forecast, guess, calculation or prophecy? Those of you who have been regular readers of our articles will know that we have predicted a price for uranium of $200/lb since 10th November 2006. As uranium now stands at $138/lb we thought that we would take a look at what other researchers and writers are saying.

Adelaide Now reported this: Macquarie analysts Max Layton and John Moorhead believe the price will average about $US125 a pound this year, but have tipped a peak of about $US150 a pound by year's end.

Monstersandcritics.com reported the following: Morgan Stanley forecasts the price will stay above $100 a pound through next year, then settling at $40 a pound by 2012.

Grant Stuart, senior manager for consulting at Deloitte & Touche, said he’s 'extremely bullish about uranium.' He predicts $140 per pound through next year and then a reduction to between $50 and $55 starting in 2010.

In their month end issue TradeTech reported the results of Wednesdays Mestena uranium auction in Texas. The industries consulting service increased the long-term price of uranium to $95/lb.

The above are big players with highly respected companies but somehow they seem reluctant to stray too far from the current spot price at any given time. Making predictions can land us in deep pooh that’s for sure, however, sticking with the herd never made anyone rich either. In our humble opinion predictions should be good for some time ahead in order that you can invest your money accordingly. To us it doesn’t make sense to keep edging up your forecast as the price moves up as this is following and not leading.

When we came up with $200/lb for uranium it was based as much on what we don’t know as what we do know. If you calculate the demand for uranium based on the current number of reactors in use plus what is planned then yes you will come up with a forecast. However this does not take into consideration all those reactors lurking in the shadows waiting to get a mention. The savvy Governments and utility companies surely would not disclose their intentions to construct many more nuclear power plants until they have secured a reliable supply of uranium. On a gradual basis we will be drip fed this data and the big names on Wall Street will adjust their predications accordingly. We don’t have any inside knowledge either so our prediction could also be wide of the mark, however we suspect that the upside for uranium is far greater than the downside as we suggested in our article on 11th February entitled “Uranium: How high could the price go…. $576?

Anyway as reported by the Financial Post on their trading desk, Peter Grandich said recently that he expects uranium to hit $200/lb – Yes!

UraMin Inc: Announces High Grade Drilling Results

A press release today by UraMin Incorporated shows an impressive set of results. To quote Ian Stalker, Chief Executive, who said the following:

'We are delighted with these results which further underline the high-grade nature of this deposit. The infill-drilling programme at Patricia is now complete and these results indicate a near surface deposit that is amenable to open-pit mining and the soft ground suggests low mining costs. We look forward to completing the feasibility study on track in 2008.'

UraMin have also published the drilling results for the Patricia Deposit at Bakouma in the Central African Republic which include the following high-grade U3O8 intersections over widths
in excess of 22 meters:

· Borehole PRC061; 54m at 0.36% U3O8 from 39m depth

· Borehole PRC065; 22m at 0.61% U3O8 from 19m depth including 3m at 1.32%
U3O8 from 25m depth

· Borehole PRC074; 43m at 0.27% U3O8 from 48m depth

· Borehole PRC075; 30m at 0.28% U3O8 from 52m depth and 36m at 0.20% U3O8
from 89m

· Borehole PRC078 24m at 4.17% U3O8 from 53m depth including 10m at 9.06%
U3O8 from 55m

· Borehole PRC083; 62m at 0.81% U3O8 from 61m including 11m at 15.16% from
112m

Now pay attention to this: UraMin have also stated that further verification is to be undertaken in a laboratory that specializes in analysis of high grade uranium-bearing ore because of the unusually high uranium values in these ore samples: Music to our ears! It will be interesting to see how the stock performs today on this news. Here at uranium-stocks we are excited by this news release and expect UraMin’s stock price to bump up. (However, the ‘sell the news’ brigade might prove us wrong.)

Taking a quick peek at the chart shows us that UraMin are making steady progress and their price has doubled this year. Some profit taking has occurred but that is to be expected we would have probably done the same had we been in at the beginning. Still this company is heading in the right direction so we are happy to hold and look to make further purchases in the near term.