CTS - Contact Resources

[bliimp]

In yesterday's 24th July ASX notice of the AGM, noted the following:-

"Resolution 6 seeks Shareholder approval for the allotment and issue of 1,000,000 Shares at an issue price of $0.50 each and 1,000,000 free attaching Unlisted Options exercisable at $0.50 each on or before 30 June 2010 to Far East Capital Limited, to raise $500,000."

Looks like Warwick Grigor of Far East Capital is beginning to get serious!

Refer to his article on "The Gem from the Paydirt Uranium Conference" as highlighted earlier by Young Trader http://www.uraniumanalyst.com/images/FEC_Contact11April07FINAL.pdf

 

[greggy]

1. YT, Aussie Dollar is 88c, could be par with US dollar soon;
2. The latest take over with significant size is Areva takeover UraMin, paid about US$10.5/lb. Besides, it is last month. Afterwards, the uranium market has suffered significant correction.
3. You cannot spot the mistake "$500m USD=$625 AUS? 1 AUS is worth $800,000 US? not bad for even a poorest guy in Australia.
4. How can you apply takeover premium to valuate a company without any sign of being taken over? I don't know which school are you graduated, or have different agenda?

Don't want to upset you, as I said agree with most of your staff. Cannot believe there are still some people attack me using FWL example. Why people cannot accept a different view?

Does it hurt FWL, or CUL at all after we settle our difference? NOT AT ALL.

OK, CTS's advantage is high grade (but erratic), and relative easy to mine and extract, could be a producer in a very short period. The EV/lb is not a good valuation method. NPV, or Discount Cash Flow will be more suitable.

I think you get it covered. Just a bit disorganized. It's not easy to read. The $15-30/lb EV staff won't help your valuation, and could be laugh stock. The NPV will justify whatever valuation you have put on.

If you use $15-30/lb EV, you don't need to buy CTS. Just close your eye, pick an uranium stocks on ASX to invest. It is not the right time to use it.

Here I go again. As per usual, you are wasting peoples time. You come here looking for a fight and then play the victim. "Some people attack me" you say.
Take a look at your own backyard before commenting on others. Its clear to me that you love attacking other peoples' analysis and then can't take the heat in return. You seem to single out YT in particular. I gather the reason for this is that you are jealous and contribute nothing of substance to this forum.
Sorry to all the mods, but I'm sick and tired of certain characters who like taking low shots at people that I respect.

 

[YOUNG_TRADER]

In yesterday's 24th July ASX notice of the AGM, noted the following:-

"Resolution 6 seeks Shareholder approval for the allotment and issue of 1,000,000 Shares at an issue price of $0.50 each and 1,000,000 free attaching Unlisted Options exercisable at $0.50 each on or before 30 June 2010 to Far East Capital Limited, to raise $500,000."

Looks like Warwick Grigor of Far East Capital is beginning to get serious!

Refer to his article on "The Gem from the Paydirt Uranium Conference" as highlighted earlier by Young Trader http://www.uraniumanalyst.com/images/FEC_Contact11April07FINAL.pdf

Hey Bliimp,

I saw that too ...... interesting,

Well CTS fell below 70c, but bounced off 65c so looks like that was ultimate support,

I think games are being played though, there is huge accumulation going on in the options today.

Back up above 70c today though,

Watching with interest

 

[danewbee]

So your LT USD/AUD would be 1:1



What significant correction? Spot price dropping from $135/$136 lb to $129/$130 lb, yeah real big correction there



lol, so I left an 'm' off you get the point, well here's one for you, spot the mistake my perfect friend! :





What premium? What are you on about? Agenda? Mate if you read my post correctly, it says if CTS were to get a takeover.

Its funny, I rarley see you post, except after I put out a detailed post, strange isn't it and then your all about picking holes ....

Some of your points are valid, but most are petty nit picking.

Sorry mate, but not really going to take your comments seriously, I detect too much of a personal attack rather than analysis,

Why don't you come up with a valuation, seeing as you sound so highly edumacted and all.

I look forward to reading it.

Cannot agree with you any more, I am "nit picking". OK, I can give you some heavyweight:

1. A question you have not asked, what is the latest purchase price for the Peru deposits? $50K+$35K+2 million shares for 20% of Peru deposits (ann. Mar 28, 2007)

Or the Peru deposit is worth $340k+10m CTS shares. At 70c/share, it only worth about $10m.

You think CTS is too smart to get such wonderful asset at deep discount, right? Why not think it differently? Why the seller is are so stupxd? Or somebody else? The deposit might be an erratic one.

2. $30/lb takeover premium for a company with such small deposit? In your dream.

3. You are totally surreal. The uranium sector correction started from May. Most uranium stocks has suffered 30-60% loss. Of course, the spot price only dropped from $139 to $120? Are you buying yellowcake, or uranium stocks?

4. CTS is no longer cheap even with your lofty valuation. You can pick a dozen uranium stocks that is cheaper than CTS use same analysis.


When the music stops, you know what happen.

 

[YOUNG_TRADER]

Dane,

Just have the guts to be here in 3months time to see where CTS is, ok?

I will be, so make sure your here.

Kinda like CUL, you fought with my valuation when its was sub 10c, where is that now?

My takeover value for CTS is $15 a lb, $15lb not $30lb $15lb get it right!

As for Uranium rout, lol, yep your right, world has switched of the Nuclear switch, and Uranium supply has come on strong, heck I even heard Cameco's mine was all back to normal :

 

[Sean K]

Gents, stop playing the man, and play the ball. Objective analysis without personal insults, period. If disagreeing with a valuation it's easy to provide your own valuation with your own numbers without derogatory remarks. Please try, it's of more benefit to all members. Cheers! kennas

 

[arkady]

You're a true legend YT! You've made me a happy man with your excellent research that you're willing to pass onto fellow ASF members. Things were looking down with my stock picks until I picked up on your posts. There's always going to be negative people with minimal facts ready to take you down but ignore them and keep up the great work.

 

[greenfs]

Cannot agree with you any more, I am "nit picking". OK, I can give you some heavyweight:

1. A question you have not asked, what is the latest purchase price for the Peru deposits? $50K+$35K+2 million shares for 20% of Peru deposits (ann. Mar 28, 2007)

Or the Peru deposit is worth $340k+10m CTS shares. At 70c/share, it only worth about $10m.

You think CTS is too smart to get such wonderful asset at deep discount, right? Why not think it differently? Why the seller is are so stupxd? Or somebody else? The deposit might be an erratic one.

2. $30/lb takeover premium for a company with such small deposit? In your dream.

3. You are totally surreal. The uranium sector correction started from May. Most uranium stocks has suffered 30-60% loss. Of course, the spot price only dropped from $139 to $120? Are you buying yellowcake, or uranium stocks?

4. CTS is no longer cheap even with your lofty valuation. You can pick a dozen uranium stocks that is cheaper than CTS use same analysis.


When the music stops, you know what happen.

If you think that you can name a dozen stocks cheaper than CTS, I will accept 4 stocks (33%) with brief comments at short notice. If you do not respond I will in future ignore your comments as Bxxxsxxt rhetoric.

 

[Vicked]

Fourth quarter results out today.

I don't think there is much in there that the market isn't already aware of.

 

[greggy]

If you think that you can name a dozen stocks cheaper than CTS, I will accept 4 stocks (33%) with brief comments at short notice. If you do not respond I will in future ignore your comments as Bxxxsxxt rhetoric.

Hi greensf,

Why don't you just save yourself a lot of trouble and put this "character" on your ignore list. Back on the subject of CTS, I notice that Intersuisse recently put out a Buy rating on CTS thinking that it is cheap.
DYOR

 

[Miner]

Hi Guys
All CTS lovers why there is a silence once the share has fallen so low.
Do not worry it is not only market pull down but also now there are too many players in uranium sector.
Though I feel there was some ramp up in CTS and it is consolidating around 65 cents I can not ignore the fact that my investment on CTS was 73 cents and I am too nervous to sell it now.
Any encouragement for me to hold and not to panic sell ?

Regards

 

[Sean K]

Hi Guys
All CTS lovers why there is a silence once the share has fallen so low.
Do not worry it is not only market pull down but also now there are too many players in uranium sector.
Though I feel there was some ramp up in CTS and it is consolidating around 65 cents I can not ignore the fact that my investment on CTS was 73 cents and I am too nervous to sell it now.
Any encouragement for me to hold and not to panic sell ?

Regards

Unlucky to have picked it at the top miner. The fundamentals are still there, and you are correct to say that this has been punished like everything else in the market. In addition to the fundaments, that have been covered, 55 should be support, and 50 probably worst case. Personally, I sell things when they have broken down through significant support, or when the fundamentals have changed for the worse. You need to work out what your investment/trading plan is and act accordingly. What was your 'plan' for this?

 

[Sean K]

I've just been advised that there's some insto buying going on behind the scenes with CTS. If you have a full service broker, you would be able to see that in the past month:

UBS bought 1.5m shares + bought 3.5m options

Meryl Lynch bought 1.9m shares but sold 1m options

Toll Hurst sold 1m shares but bought 1.1m options

Many conspiracy theories may be drawn from this. Personally, I find it unusual for 3 big brokers/managers to be buying into such a small cap 'explorer'. Although, we do see their names on a few registers around the place. UBS's position seems especially odd to me. Why more than double the options? And Toll Hurst switching to options...

Conspiracy theorists?

 

[YOUNG_TRADER]

Hey Kenna,

Well one thing I know is that when an Insto buys stock and reaches a 5% holding it must release a becoming a substantial shareholder notice, I suppose by buying options they avoid this as their is no requirement for option holdings

I have also seen that lately there has been a high conversion of the options, another 1m+ where convereted in todays ann, about 10m have been converted on memory in the last 2 months which is significant I think

One things for sure the SP has not escaped the carnage of the overall mkt

 

[jman2007]

In yesterday's 24th July ASX notice of the AGM, noted the following:-

"Resolution 6 seeks Shareholder approval for the allotment and issue of 1,000,000 Shares at an issue price of $0.50 each and 1,000,000 free attaching Unlisted Options exercisable at $0.50 each on or before 30 June 2010 to Far East Capital Limited, to raise $500,000."

Looks like Warwick Grigor of Far East Capital is beginning to get serious!

Refer to his article on "The Gem from the Paydirt Uranium Conference" as highlighted earlier by Young Trader http://www.uraniumanalyst.com/images/FEC_Contact11April07FINAL.pdf

Cheers Bliimp,

Makes interesting reading, the following quote from the report has a bit of a cloak and dagger feel to it though. According to Warwick Grigor, the management is the weakest link:

"We see a lack of transparency with the management and corporate governance and are unsure of the intentions of some of the key shareholder groups."

Would someone like YT or Kennas care to speculate on this statement? I'm not exactly sure what it means by "intentions" of key share holder groups. How would these groups exert their intentions?... through voting rights?

Oh and one more thing, would you techies out there recommend this stock as a long-term hold? I jumped on at 51c a few months ago hoping for a slow but steady return as the news from Coarachapi filtered out, but this recent roller coaster ride has made me think that perhaps this stock isn't suitable for conventional investors? There were some mutterings earlier in this thread that CTS has been ramped a bit, but I don't agree...

Thoughts?..

 

[Sean K]

Cheers Bliimp,

Makes interesting reading, the following quote from the report has a bit of a cloak and dagger feel to it though. According to Warwick Grigor, the management is the weakest link:

"We see a lack of transparency with the management and corporate governance and are unsure of the intentions of some of the key shareholder groups."

Would someone like YT or Kennas care to speculate on this statement? I'm not exactly sure what it means by "intentions" of key share holder groups. How would these groups exert their intentions?... through voting rights?

Yes, through voting rights. I believe this is a good correction for most stocks that had to happen in a healthy economic environment. (Sorry to sound like PK.) I am cautious however, at those stocks inextricably linked to the US housing market, which I shorted last week, but bought back too early. The effect and extent of the US credit market is still unknown really, but looks more bearish atm. There is too much noise for anyone to make a qualified assessment right now. What I think will naturally occur from now is a tightening of credit, reduced buying on margin, and ultimately a beneficial effect for world economies. As far as individual stocks go: those who rely on funding from the market with highly speculative futures, will suffer. You have to decide whther this is a quality play or not.

 

[jman2007]

Yes, through voting rights. I believe this is a good correction for most stocks that had to happen in a healthy economic environment. (Sorry to sound like PK.) I am cautious however, at those stocks inextricably linked to the US housing market, which I shorted last week, but bought back too early. The effect and extent of the US credit market is still unknown really, but looks more bearish atm. There is too much noise for anyone to make a qualified assessment right now. What I think will naturally occur from now is a tightening of credit, reduced buying on margin, and ultimately a beneficial effect for world economies. As far as individual stocks go: those who rely on funding from the market with highly speculative futures, will suffer. You have to decide whther this is a quality play or not.

Cheers Kennas,

Would've been good to go along to shareholder meeting in Perth in a couple of weeks, but I be back out on site then. As far as the geological story goes, Corachapi seems reasonably straightforward, and metallurgical testwork looks good. As far as trading strategy goes, that's a good question!

What would be your thoughts re this stock as a long-term hold? I jumped on at 51c a few months ago hoping for a slow but steady return as the news from Corachapi filtered out, but this recent roller coaster ride has made me think that perhaps this stock isn't suitable for conventional investors? There has been some shrewd trading going on recently, do you think CTS is susceptible to pump and dump?

 

[bliimp]

Cheers Bliimp,

Makes interesting reading, the following quote from the report has a bit of a cloak and dagger feel to it though. According to Warwick Grigor, the management is the weakest link:

"We see a lack of transparency with the management and corporate governance and are unsure of the intentions of some of the key shareholder groups."

Would someone like YT or Kennas care to speculate on this statement? I'm not exactly sure what it means by "intentions" of key share holder groups. How would these groups exert their intentions?... through voting rights?

Oh and one more thing, would you techies out there recommend this stock as a long-term hold? I jumped on at 51c a few months ago hoping for a slow but steady return as the news from Coarachapi filtered out, but this recent roller coaster ride has made me think that perhaps this stock isn't suitable for conventional investors? There were some mutterings earlier in this thread that CTS has been ramped a bit, but I don't agree...

Thoughts?..

Regards the management issue, the key points I can make relate to the following timeline :-
1. Late March ... Paydirt conference in Adelaide attended by Warwick Grigor of Far East Capital
2. 11 April ........ Far East Capital details its assesment of CTS (with Mgmt concern) in The Gem from the Paydirt Uranium Conference
3. 7 May ......... Managing Director (MD) resigns (from ARV as well)
4. 24 July ........ CTS announces the share/options issue to Far East Capital

It may be inferred that the MD resignation and the subsequent appointment of the highly credentialled Dr Richard Napier was a means of strengthening the management and corporate governance issue.

Obviously, Warwick Grigor of Far East Capital must have been satisfied! ... he has put his money where his mouth is!!!

If he still had concerns with management, I very much doubt he would have shown any interest at all ... what with the 100s of other junior uranium plays that exist today.

And jman2007 ... if Warwick Grigor has jumped in at 50c and you at 51c ... well, I get the feeling that you have probably done ok and will do ok if you continue to hold!

 

[jman2007]

Regards the management issue, the key points I can make relate to the following timeline :-
1. Late March ... Paydirt conference in Adelaide attended by Warwick Grigor of Far East Capital
2. 11 April ........ Far East Capital details its assesment of CTS (with Mgmt concern) in The Gem from the Paydirt Uranium Conference
3. 7 May ......... Managing Director (MD) resigns (from ARV as well)
4. 24 July ........ CTS announces the share/options issue to Far East Capital

It may be inferred that the MD resignation and the subsequent appointment of the highly credentialled Dr Richard Napier was a means of strengthening the management and corporate governance issue.

Obviously, Warwick Grigor of Far East Capital must have been satisfied! ... he has put his money where his mouth is!!!

If he still had concerns with management, I very much doubt he would have shown any interest at all ... what with the 100s of other junior uranium plays that exist today.

And jman2007 ... if Warwick Grigor has jumped in at 50c and you at 51c ... well, I get the feeling that you have probably done ok and will do ok if you continue to hold!

Well Bliimp

Fair point, Grigor has obviously had a good look at CTS over the past few months and likes what he sees. Grigor is also on the Board for Monaro mining (another Uranium play) , so he knows a thing or two. I still think "potential management risk" is a very hard issue for individual investors to quantify, as it could be quite subjective.
At the end of the day, there are a lot of Uranium stocks around that are in serious damage control at the moment. CTS has done well do weather the storm, which is probably due both to the quality of its assests and the "discounted" value it is trading at cf to its peers.

 

[YOUNG_TRADER]

I've just been advised that there's some insto buying going on behind the scenes with CTS. If you have a full service broker, you would be able to see that in the past month:

UBS bought 1.5m shares + bought 3.5m options

Meryl Lynch bought 1.9m shares but sold 1m options

Toll Hurst sold 1m shares but bought 1.1m options

Many conspiracy theories may be drawn from this. Personally, I find it unusual for 3 big brokers/managers to be buying into such a small cap 'explorer'. Although, we do see their names on a few registers around the place. UBS's position seems especially odd to me. Why more than double the options? And Toll Hurst switching to options...

Conspiracy theorists?

We all know that a large mkt correction is upon us, we also know that as a result most stocks are dropping like flies, Why MBL was $92 a few weeks back today $67 I think, ouchhhhhhhhhhh!

Anyway, my comments are purely based on the fact that I think this is a short term correction, so with that in mind has anybody bothered to ask themselves why UBS Meryl Lynch and others are buying (and selling) CTS?

Many 'conspiracy theories' can be made, but one thing is for sure, the other Uranium plays that I have seen get Insto support have all risen very very strongly indeed, for example, MTN Insto's got on at about $1 and who can forget MRU, Mantra, the U company with just dirt but I think 4 or 5 Into's on its share registry whose price has gone from 20c to $1

Once this correction is over and the dust has setlled it will be interesting to see how much more UBS and others have bought (or sold for that matter)

As for my conspiracy theory, well I've always felt at these levels CTS is a clear takeover target, a few weeks back Blimp made the connection between CTS -ARV - Mega Uranium and now we have Insto's getting on board, with UBS particularly accumulating CTSO, draw your own conlcusions

Anyway like I said we need to wait for the dust to settle