CTS - Contact Resources

[peteai]

CTS Appears very good value although admittedly being a Uranium explorer it is by definition a high risk.

However using very rough metrics

they state on their homepage (contactresources.com.au)
10 million pounds of resource (likely to grow)
Spread over different countries and regions
An Analyst (Far East Capital) estimates cost roughly $20/pound

estimate of total earning $50 (profit per pound) * 10mill = $500 million
company now valued at about $27 million

Can I ask for opinions on chances the projects will go ahead ?

Is it unlikely any of these project will not be economic ?

________
Thanks,
PETEAI

 

[copper_hot]

20.5c. testing all time lows

found this article on Mega Uranium and found it interesting given previous suggestions that it could takeove CTS:



Mega Uranium, the listed Toronto, Ontario-based uranium entity, may acquire more than one junior uranium company, said President Stewart Taylor.
"We've got a shortlist of companies that we are looking at and we're looking worldwide," Taylor said. Companies that currently have properties with drill holes would be considered "advanced stage," he explained. In an ideal situation, Mega would like to acquire companies with advanced stage uranium projects and resources in countries in which it is currently operating, he said.
With a market cap of CAD 588.5m (USD 596.4m), Mega currently has operations in Australia, Argentina, Bolivia, Colombia, Mongolia, Canada and Cameroon. It is focused on advancing its projects in Queensland and Western Australia. It has a total of 47m pounds of historical reserves in Australia.
The company has cash and cash equivalents of CAD 88m (USD 89.1m). Taylor said Mega will go to the capital markets to fund its acquisitions. "Our previous acquisitions were done mainly through shares transactions. Our preferred way is through shares," he noted. The CAD 88m will be used for exploration and drilling purposes, he explained.
The company is not actively seeking advisors but gets proposals from various sources, Taylor said. The company's corporate counsel in Australia is Minter Ellison.
At the same time, Mega is looking to divest its base and precious metals assets, Taylor said. "Our focus is uranium. The other properties are not a priority. The time has come to look at them and decide what to do with them," he explained. Taylor said the company is in the early stages of this process and has not hired advisors for this purpose. He said the company would be open to proposals regarding this. Mega has interests in non-uranium properties including a copper-nickel project in Guinea, West Africa and several gold and base metal projects in Ontario, Canada and Brazil.


Cheers

 

[YOUNG_TRADER]

Yeah, they're smart,

Instead of moving back in the heat, they've sat back and waited, now CTS is like you said near all time lows, perfect time to pounce, bastards they are!

20.5c. testing all time lows

found this article on Mega Uranium and found it interesting given previous suggestions that it could takeove CTS:



Mega Uranium, the listed Toronto, Ontario-based uranium entity, may acquire more than one junior uranium company, said President Stewart Taylor.
"We've got a shortlist of companies that we are looking at and we're looking worldwide," Taylor said. Companies that currently have properties with drill holes would be considered "advanced stage," he explained. In an ideal situation, Mega would like to acquire companies with advanced stage uranium projects and resources in countries in which it is currently operating, he said.
With a market cap of CAD 588.5m (USD 596.4m), Mega currently has operations in Australia, Argentina, Bolivia, Colombia, Mongolia, Canada and Cameroon. It is focused on advancing its projects in Queensland and Western Australia. It has a total of 47m pounds of historical reserves in Australia.
The company has cash and cash equivalents of CAD 88m (USD 89.1m). Taylor said Mega will go to the capital markets to fund its acquisitions. "Our previous acquisitions were done mainly through shares transactions. Our preferred way is through shares," he noted. The CAD 88m will be used for exploration and drilling purposes, he explained.
The company is not actively seeking advisors but gets proposals from various sources, Taylor said. The company's corporate counsel in Australia is Minter Ellison.
At the same time, Mega is looking to divest its base and precious metals assets, Taylor said. "Our focus is uranium. The other properties are not a priority. The time has come to look at them and decide what to do with them," he explained. Taylor said the company is in the early stages of this process and has not hired advisors for this purpose. He said the company would be open to proposals regarding this. Mega has interests in non-uranium properties including a copper-nickel project in Guinea, West Africa and several gold and base metal projects in Ontario, Canada and Brazil.


Cheers

 

[peteai]

Strange trading today over 500,000 shares changed hands all at $0.14
Resource Capital Research released the report on 17th March which an extract below shows they think it is very good value. There is lot of uranium that would be easy to access, which I have heard in another report that this could be an option to generate cash, for a larger scale mine.

Cheers
Peteai


Investment Comment: CTS is led by a well qualified management team that is demonstrating an ability to grow through acquisition, targeting near surface projects that have low exploration costs and good upside resource potential in favourable, pro uranium mining jurisdictions. With an adjusted EV/resource value of US$4.18/lb U3O8 (fully diluted) CTS appears modestly priced on a peer basis given the anticipated exploration success - price target $1.04/share. A capital raising is required 1H08, prior to expiry of ~54m options at A$0.20 in July ‘08 which could provide funding of A$10.8m.

 

[juw177]

CTS was on the list of Opes holdings. But who ever has been selling the last few days has found plenty of buyers. This stock has been in a constant downtrend and it was only a matter of time before the price is right and the buyers come in.

(I went long based on the past few day's action with demand is soaking up supply.)

 

[peteai]

CTS was on the list of Opes holdings. But who ever has been selling the last few days has found plenty of buyers. This stock has been in a constant downtrend and it was only a matter of time before the price is right and the buyers come in.

(I went long based on the past few day's action with demand is soaking up supply.)

It appears a large chunk of the ANZ holding in CTS has been sold today (they held 5% of CTS) Despite this there seems to enough buyer demand to keep the share price from falling.

I would imagine once ANZ has finished their selling, the Contact Uranium SP wll rise - basic demand vs supply, I have bought more myself - believing the Contact Uranium is too good value to resist (not that anything is certain)

Cheers,
PETEAI

 

[juw177]

Yep. i saw today's action. ANZ (I assume) at one stage was putting up 300k+ parcels on the sell side at 0.13 and 0.135. All of which was quickly taken out by equally big orders.

The ultra high volume and price support provides a strong buy signal from VSA point of view. ANZ should be about done with the selling now and whoever bought most of them will either keep accumulating or try to mark up the price.

 

[grace]

Just had a brief look at these (haven't held for a few months)
- any thoughts on money at the bank - only $650 000 at end of December07 (any come in since then?)
- Options to expire June 08 at 20 cents to convert are currently 'out of the money'.

I have not kept up to date recently on this one, but I am wondering what other holders thought about their cash position, and the fact that the options are out of the money and expire fairly soon.

Options trading at less than a cent (gosh I think I sold mine last year at +30cents and they had less uranium then!). Just concerned about their cash position.....any thoughts?

 

[YOUNG_TRADER]

I'm on a nice big loss on this one,

Partly due to subprime, partly due to Uranium collapse and partly due to me being an idiot

I'm pretty sure they will have to raise funds and at these levels that will = alot of dillution

Its such a shame really, they have such an amazing project in Peru

and a very good one in Kazakstan,

Hopefully it will rebound and I can cut some losses

 

[jman2007]

I'm on a nice big loss on this one,

Partly due to subprime, partly due to Uranium collapse and partly due to me being an idiot

I'm pretty sure they will have to raise funds and at these levels that will = alot of dillution

Its such a shame really, they have such an amazing project in Peru

and a very good one in Kazakstan,

Hopefully it will rebound and I can cut some losses

YT,

I've well and truly taken a bath with CTS.

Yep, to raise some decent cash at these levels will require a serious volume of shares to be issued. I think the lack of shareholder commincado whilst they were extending the mineralisation at Corachapi toward the end of last year really hurt them.

The results were so eagerly awaited and anticipated, and the while the grades were certainly solid(?) they were perhaps less than what some people had expected.

Corachapi looks great if you just take the numbers into account, but there is still some uncertainty over whether an operation could realistically be set up in this environment...i.e become almost the highest mine in the world.

Cheers
jman

 

[YOUNG_TRADER]

So I'm not alone, well at least tthats something

Want to form a Lynch mob?? pretty sure Kennas will help us, heck we can launch the attack from his Peruvian abode :

I asked him to throw some Donkey dung at the CTS peeps if he ever sees em!

Yeah you hit the nail on the head Jman

I think the lack of shareholder commincado whilst they were extending the mineralisation at Corachapi toward the end of last year really hurt them.

That was it in a nutshell, the complete lack of communications is what ruined

And yeah I too am expecting a largish issue of shares, I mean they need at least $5m - $10m going forward = 35m shares at 15c? gul 50m at 10c? who knows

Now about that Lynch mob

 

[jman2007]

So I'm not alone, well at least tthats something

Want to form a Lynch mob?? pretty sure Kennas will help us, heck we can launch the attack from his Peruvian abode :

I asked him to throw some Donkey dung at the CTS peeps if he ever sees em!

Yeah you hit the nail on the head Jman



That was it in a nutshell, the complete lack of communications is what ruined

And yeah I too am expecting a largish issue of shares, I mean they need at least $5m - $10m going forward = 35m shares at 15c? gul 50m at 10c? who knows

Now about that Lynch mob

Lynch mob?...

Lol...well we'll probably need to pack our climbing gear and oxygen tanks to get up to Corachapi YT....and then er...pelt them with small pebbles and alpaca dung

The half yearly was rather vague and didn't really shed to much light on the strategy going forward, other than "carrying forward exploration at CTS's key projects with a view to upgrading and expanding the known resources" (or words to that effect)...pretty broad terms really.

I guess one factor Coarachapi does have in its favour is that the straigraphy appears to be flat lying and the mineralisation fairly close to the surface, perhaps this could offset the infrastructure difficulties in setting up an operation at this altitude in the future.

Cheers
jman

 

[Sean K]

Want to form a Lynch mob?? pretty sure Kennas will help us, heck we can launch the attack from his Peruvian abode :

I asked him to throw some Donkey dung at the CTS peeps if he ever sees em!

May be back up that way in a couple of weeks. Perhaps I should drop in? Do they have an office in Lima? I'll take the Buro as backup.

 

[peteai]

Has CTS reach its bottom ? I sure hope so

After months of steady decline it has had a stable stretch arounf 13c - 15c.
I also heard that they have arranging some extra financing (called their office )

Cheers,
Peteai

 

[56gsa]

the threat of donkey dung seems to have done the trick - CTS starting to look like a nice round bottom... 5dMA crossed the 20dMA for the first time since Nov07.

options ex price 20c on 30Jun08 almost in the money and at 2/2.5c today could make an interesting play with 6 weeks to go?

 

[jman2007]

I'm pretty sure they will have to raise funds and at these levels that will = a lot of dillution.

Looks like what we feared has come to pass YT. 26,000,000 new shares to be issued at 11c....and to raise only $2.86M. Half of the issue will be subject to shareholder approval so they might have a bit of a bun fight (or a dung fight ) on their hands to pass this motion. Hit very hard in trading today, down 13.5%

Being backed into a corner as they are, I'm not really sure what their other options would be however. Even Warwick Grigor might be getting a crack over the knuckles, as I think FEC took up a placement at 50c, so even the big boys didn't see this coming....

Where to from here?...

jman

 

[YOUNG_TRADER]

Uranium is out of flavour it seems

I don't know about you but I can't do anything but hold, I'm down over $100k on this

Thank god for IRC ACS and MXR else I'd be an unhappy camper lol


I'm gonna just bottom draw these and wait for the U Bomb to explode

An SPP to all of us at these levels with some bonus options would have been better you ****s!!!!!!!

 

[jman2007]

Uranium is out of flavour it seems

I don't know about you but I can't do anything but hold, I'm down over $100k on this

Thank god for IRC ACS and MXR else I'd be an unhappy camper lol


I'm gonna just bottom draw these and wait for the U Bomb to explode

An SPP to all of us at these levels with some bonus options would have been better you ****s!!!!!!!

YT,

I really don't like bagging a company that's already in enough pooh already, but I am getting increasingly frustrated with the situation and am beginning to question the leadership of Richard Napier. I always get suspicious when I see guys with phD's putting "Dr" before their names.

How much are we paying this guy?....probably in the order of $300-350K, and he seems to have single handedly overseen the collapse of the CTS sp to a fraction of what it was worth 10 months ago. I know many U companies have suffered, but CTS has probably been one of the hardest hit. I think this places us all in a precarious position, if they continue to prove up the JORC resource and undertake engineering scoping studies, and there is no material improvement in the sp, CTS imo would become vunerable to takeover at a bargain basement price.

The next question; what can we do about it? We could begin to bomabard these guys with e-mails and vent our disatisfaction that way, or potentially, if there is enough shareholder discontent a EGM could be called and a vote of no confidence passed in this guy...oh sorry, I mean "Dr" Napier. Although being the executive chairman as well, that may be tough (?) Not sure what the exact rules are there.

Sorry to hear about your sizeable loss here YT, I see what you mean.... you really just have to hold these for the time being. I am really trying to see positives here, but they seem few and far between atm.

jman

 

[diamond h]

Hi,unfortunately bought into this Company following positive comments on another chat site. I have not had a computer for over two months so have got a bit of a shock to see the current share price. Not the same $s as you Y.T. but have a few options which are virtually worthless now. Would like advice as to whether it is worth holding the head shares for the long term or dumping them at a 65% loss and looking for other opportunities.

 

[peteai]

Uranium is out of flavour it seems

I don't know about you but I can't do anything but hold, I'm down over $100k on this

Thank god for IRC ACS and MXR else I'd be an unhappy camper lol


I'm gonna just bottom draw these and wait for the U Bomb to explode

An SPP to all of us at these levels with some bonus options would have been better you ****s!!!!!!!

Hi,unfortunately bought into this Company following positive comments on another chat site. I have not had a computer for over two months so have got a bit of a shock to see the current share price. Not the same $s as you Y.T. but have a few options which are virtually worthless now. Would like advice as to whether it is worth holding the head shares for the long term or dumping them at a 65% loss and looking for other opportunities.

Hey YOUNG TRADER & diamond h,

I think a lot of us are in the same boat as you.
Previously, with less resource the SP was at 0.70 it just goes to show that valuing shares are a black art.

IMHO shares tend to eventually revisit previous highs unless something fundamentally devalues the company - given that, I believe there is a lot more upwards potential than downwards BUT with any share there is a always risk.

I just wish there was a more clearer picture from the company about their plans. Actually we should demand more info & especially YOUNG TRADER why don't you call them as you deserve an explanation and a plan for the future ?.

I've called twice, the first time they told me they were getting finance and that it was just being sorted out (& they said a share issue was only an option if needed - well its seems they took this option) The second call they suggested I email them which I have just done this morning.


Cheers,
Peteai