CTS - Contact Resources

[elcruzy]

Guys I think most of you know I'm pretty good at picking undervalued stories,

CTS is my favoured Uranium play by far, regardless of current management etc, its just like MTN in its early days, while other JORC compliant companies rocket CTS's share price is lagging, well just like MTN it will only be a matter of time before a take over offer comes to cherry pick this company

With 110m shares on issue and 10mlbs of Uranium I see a take over offer of around $1.35 = $150m approx = $15 per lb JORC uranium

Wait and see

I also made the call for MTN and i see some similarities in CTS, its too early to calculate $$$ but if the board is legit and we can get to a JORC complaint resource then there is nowhere to go but up. i also read that there was a union revolt or some political unrest in Peru recently & also keep in mind that the landscape may make it difficult to mine / transport / get environmental approval.

Only time will tell. (plus a few decent announcements)

 

[elcruzy]

check out this article http://www.thewest.com.au/default.aspx?MenuID=32&ContentID=28631

while i dont subscribe to far east capital i have heard of them and they also think contact resources as one company with accessible Uranium. no doubt about it - i'm holding this one long term, the spike in the SP is just one ann away!!! its also pretty cheap compared to other prospective stocks especially some IPO's that open 275% on opening day.

Uranium hopefuls must act to maximise prices

14th May 2007, 9:00 WST



The race is on for uranium companies such as Deep Yellow and Marathon Resources to develop their projects within the next three years to cash in on the booming uranium market, according to a Far East Capital report to be released today.

After comparing the potential profitability of emerging yellowcake producers based on standard industry economics, Far East Capital uranium analyst Warwick Grigor said there was fundamental value in emerging producers but companies needed to fast-track projects if they were to maximise the peak of the price cycle.

The spot price for the radioactive ore has climbed nearly 180 per cent in the past 12 months to a record closing price of $US120 a pound last week, while Nymex December uranium futures are trading at $US153.90/lb.

“Overwhelmingly the conclusion is that the economics are real and companies should be pushing ahead full steam to develop their projects,” Mr Grigor said.

“The biggest winners on our table and in the stockmarket are those lowgrade companies that we had been dismissive of two years ago. Since then the uranium price has quadrupled, catapulting these companies into enviable positions.”

He estimates that if all 19 Australian potential uranium producers were to reach production it would increase uranium supply by 17,000 tonnes a year, or up to 30 per cent over the next five years. If combined with increasing global supply, this could drag the uranium price back below $US100/lb.

“This means that the highly leveraged, low-grade companies will need to be up and running as early as possible to maximise the peak of the uranium price cycle, sometime between today and three years time,” he said.

One of the hurdles will be the high capital costs of up to $300 million to develop many of the low-grade projects.

The report suggests that this could be a significant issue for Acclaim, Bannerman, Deep Yellow, Toro and Uranex, while better-placed companies include Contact, Energy Metals, Monaro and Uranium King.

Mr Grigor warned many of the floats now hitting the market were opportunistic plays and that it would be difficult for even potential producers to negotiate their way through regulatory and compliance issues in the three-year time frame. “The ones in the USA are probably the most likely to go ahead because of the greater reliability of the data and the historical information ... but those mines are unlikely to big ones,” he said.

Mr Grigor said he was constantly being asked if the uranium sector was “another dotcom boom” and the unreserved answer was no because it was possible to run fundamental analysis.

“You can estimate rates of production, you have a market price for the product and you can reasonably estimate capital and operating costs,” he said. “This is a bull market based on hard factual economics, not fantasies and what-ifs. The conclusion is that at these uranium prices there are enormous cash flows that can be made.”

Mr Grigor said there were still a number of unknowns in trying to determine the numbers for some companies.

The main assumptions used in the absence of official numbers included capital expenditure per tonne of capacity of $85 and a spot price of $US113/lb.

 

[jman2007]

A general word of caution for all,

As most of you probably know, it is absolutely vital that you do your own research and arrive at your own conclusions before parting with your hard-earned dough. But with the number of comapnies jumping on the Uranium bandwagon at the moment, it can become difficult to weed out the potential producers from the pure opportunists.

The sad reality is that most of the new mineral companies claming to have "prospective" Uranium tenements are doomed to fail, although some do have potential. Some Directors will have no intrest in mining or producing Uranium at all, but rather will wait till the market conditions suit them before cashing in on the boom and riding of into the sunset, leaving us; the humble investor, with a bunch of worthless shares.

In saying that, there are several companies which do have quality management and portfolios, and an obvious desire to reward their shareholders over the next few years. With the Cigar Lake mine looking rather sick at the moment, all looks set for investors to strike while the irons hot. Who knows, perhaps we will never see another investment opportunity like this in our lifetime?

But don't take my word for it, as I said, draw your own conclusions, and good luck!

Cheers
Jman2007

 

[insider]

A general word of caution for all,

As most of you probably know, it is absolutely vital that you do your own research and arrive at your own conclusions before parting with your hard-earned dough. But with the number of comapnies jumping on the Uranium bandwagon at the moment, it can become difficult to weed out the potential producers from the pure opportunists.

The sad reality is that most of the new mineral companies claming to have "prospective" Uranium tenements are doomed to fail, although some do have potential. Some Directors will have no intrest in mining or producing Uranium at all, but rather will wait till the market conditions suit them before cashing in on the boom and riding of into the sunset, leaving us; the humble investor, with a bunch of worthless shares.

In saying that, there are several companies which do have quality management and portfolios, and an obvious desire to reward their shareholders over the next few years. With the Cigar Lake mine looking rather sick at the moment, all looks set for investors to strike while the irons hot. Who knows, perhaps we will never see another investment opportunity like this in our lifetime?

But don't take my word for it, as I said, draw your own conclusions!

Cheers
Jman2007

This belongs in the uranium thread and not the CTS thread... It's like you're trying to down ramp... imo

 

[bigt]

Hey YT - what are your thoughts now on CTS? As you hold a large (unknown to me) quantity of CTS, what are your long term plans for this holding?

Recent trading has been dismal, as has the lack of information coming out from CTS re drilling etc.

I'm holding long term, though would appreciate any thoughts or sharing of information re CTS. Thanks.

 

[insider]

Yes trading is terrible... last time i checked there was an individual selling 100,000 shares at 53.5 cents... that's a lot...

 

[YOUNG_TRADER]

Guys all I can say is like MTN, the asset is there, how long the market takes to realise this is another matter,

I'm looking to buy more at these levels as a re-rating will happen, right now at this mkt cap you can buy CTS, MRU or GBE, given MRU has nothing but dirt and Insto backing, GBE has a greenfields discovery and CTS has a high grade JORC'd deposit I think I know where my money is going

 

[nizar]

Guys all I can say is like MTN, the asset is there, how long the market takes to realise this is another matter,

I'm looking to buy more at these levels as a re-rating will happen, right now at this mkt cap you can buy CTS, MRU or GBE, given MRU has nothing but dirt and Insto backing, GBE has a greenfields discovery and CTS has a high grade JORC'd deposit I think I know where my money is going

Timely sector rotation can be very profitable.

Is that why your avatar is so sad YT? LOL :
Coz youve still got your funds in the uranium sector while the oil&gas sector is going ballistic.

I dont think its the end for uranium, far from.

But right now sentiment is against it.

GO where the money is, and go there often. Right now thats NOT in uranium stocks...

 

[YOUNG_TRADER]

Timely sector rotation can be very profitable.

Is that why your avatar is so sad YT? LOL :
Coz youve still got your funds in the uranium sector while the oil&gas sector is going ballistic.

I dont think its the end for uranium, far from.

But right now sentiment is against it.

GO where the money is, and go there often. Right now thats NOT in uranium stocks...

I prefer to accumulate huge positions when I have very little competetion as the "sheep" are grazing elsewhere :

With the Uranium mkt staying strong for yonkes, this wil be a global asset by anyones measure, time will tell if I'm right

 

[bigt]

Well somethings stirred up some interest, single buyer in for half a mill @ 53c.

...that you YT??!

 

[insider]

Well somethings stirred up some interest, single buyer in for half a mill @ 53c.

...that you YT??!

DUDE YOU SCARED ME FOR A SECOND... It's $53,500 WORTH... I'M WITH YT ON THIS ONE... IT'S JUST A MATTER OF TIME UNTIL THE MARKET REALIZES THE VALUE...

 

[bigt]

Nah, gotta be $250 000 worth (approx)...500 000 @0.53c?

Someone wants a big piece of yellowcake!

 

[insider]

Nah, gotta be $250 000 worth (approx)...500 000 @0.53c?

Someone wants a big piece of yellowcake!

Appologies BIGT... I thought you were referring to my comment from yesterday... Yes very positive to see... Perhaps I can make some back eh

 

[YOUNG_TRADER]

Nah, gotta be $250 000 worth (approx)...500 000 @0.53c?

Someone wants a big piece of yellowcake!

It was actually 1 order, came on in the am for 500k at 50c, moved up to 55c to fill, got just under 500k, then dropped down to 53c and amended its volume to be another 500k = One buyer for 1m shares = $500k

Now last year I would have thought that that order was huge, but now, well its good, but not huge, we need a few more of these IMO to kick start things

 

[KIWIKARLOS]

Ann out regarding Uranium doesn't look like its ignited much interest must be one of their smaller projects or just average results.

Any thoughts ?

 

[nizar]

Now last year I would have thought that that order was huge, but now, well its good, but not huge, we need a few more of these IMO to kick start things

Well i see you have raised your standards bro, you must be a big player by now if 500k is nothing, keep up the good work champ

CTS starting to look the goods.
Looks like its about to break upwards from a descending triangle.

Market cap is a bit of a joke at $50m. I remember OMC when it was the same market cap at 50c. Wasnt there for long....

 

[insider]

I hope you're right Nizar... for my pockets sake of course... I have sooo many 21st birthdays this year with an average of 100 dollars going to each of them... damn my heart just skipped a beat...

 

[YOUNG_TRADER]

Well i see you have raised your standards bro, you must be a big player by now if 500k is nothing, keep up the good work champ

CTS starting to look the goods.
Looks like its about to break upwards from a descending triangle.

Market cap is a bit of a joke at $50m. I remember OMC when it was the same market cap at 50c. Wasnt there for long....

800k CTSO, quiet a nice parcel if I do say so myself,

Totally agree re its undervaluedness on a comparative basis, Corachapi is worth $1.30 from memory at a take over of $15/lb

Now add to this the Kyrgyzstan drilling, looks like its a 2 project company

 

[Sean K]

I agree with Niz. Descending triangle, and looks like there is good support at 50, but not out of the woods. Stochs pocking up, MACD still flat, but there's long term supprt here. Will have to break the downward trend line and then at least 53, possibly 55 to be confirmed starting a new trend - sideways or up.

 

[YOUNG_TRADER]

Almost forgot, Intersuisse Invesment Bankers have a buy recommendation on CTS at 50c I think heres the link

http://www.intersuisse.com.au/files/JRM Winter 2007 - May.pdf


Agree with Kennas and Niz, may take some serious announcements to get this out of sideways trending, would have thought todays would have created a bit more of a stir,

Its clear Uraniums come off the boil, but the fundamentals are still there!

Annoyed because I paid an avg 35c for my opies

LT hold for me though