DYL - Deep Yellow

[Sean K]

New presentation out.

Blah.

It's going to take so long for this mob to start building anything.

My bet is that when they eventually get the DFS out on Mulga Rock I'll be well dead.

Blah.

I'm just about done with the uranium narrative. I was lucky to get in before Sputt changed the game. I might take my chips off the table and put it into something more exciting. Like putting a bet on the Speaker of the Lower House being ejected for being completely one sided and biased. He might even get another dissent vote against him today. A complete shambles. He can not allow Burney to not answer direct questions again. She's deep yellow for the ALP.

 

[Sean K]

Some uranium stocks have been in a stealth bull run for the past few months. DYL up 100% since Apr. MC just under $700m, but I can see it possibly approaching ATHs at this rate, especially if POU puts on a couple more dollars. MC will be closer to a billion by then which I'm not sure is justifiable for something so far away from producing. Will be donning a parachute around the red line I think.

View attachment 161961

Decisions, decisions...

 

[Sean K]

DYL doing as expected really. Has been held up by a back step in POU. I haven't bailed yet, influenced by my poor timing by selling BOE at a strong resistance level which it subsequently shot through completely unjustifiably IMO. Which means I'll **** up my exit from this. Punters should be buying when I'm selling these days.

 

[Sean K]

DYL MC is around a billion and they're a decade from baking a yellow cake. But, it's knocking on the door again. I really should take half off the table, but I'm feeling greedy. Is there a trading saying for that? Like, you're an idiot?

 

[bux2000]

i have picked DYL for Novembers stock picking competition.

I believe Uranium still has a long way to run. However there appears to be alot of other commentators saying the same thing .......never a good sign.

In saying all that technically it appears DYL is showing signs of some consolidation and hoping the move when it moves will be to the upside.

All the best

bux

 

[Sean K]

Even with POU's stunning rise, DYL have refused to bring forward FID on Tumas. Maybe they're expecting a correction or there's some strategic reason for offtakes and financing to be secured with a uranium price over a certain level for an extended period of time before the trigger is pulled. Even though PDN and BOE have made the call much earlier. Disappointing JB is holding this back from an outsiders perspective. The go-slow on Mulga Rock is very frustrating as well. There's every chance these guys will miss the boat on this run up and an accident happens somewhere which destroys the industry again.

 

[Sean K]

DYL MC now over a billion and not a cake in sight. No idea what it should be worth. I thought BOE was overvalued when it hit a billion too so I'm obviously a deer with no eyes.

With POU around 100 bucks, JB is looking like a goose sitting back on these assets waiting for the price of uranium to hit whatever threshold he's dreaming of. They're gunna miss the train if they keep sitting on their hands for much longer.

I took half off the table back in 2021 and am itching to halve it again.

 

[Sean K]

I missed the peak today but skimmed some not far off. I love you, uranium.

 

[Sean K]

Since I sold another half of my gift that keeps on giving last week it means it's probably going to double again from here. $1.3b MC and years away from baking any cake. I don't understand why they seem to be on a go-slow while uranium is pumping. Would have been a good time to do a CR with under $30m left in the bank. There'll probably be another Fukushima between now and when they get into production on anything.

 

[Sean K]

Holding well above support, looking good, but jeepers creepers, $1.2b MC and years away from baking a cake which is going to cost about $500m in capex, for a start.

I've said this before and I'll say it again, if uranium is over $100 and you can't fast track to development you're too old or too lame to be running a uranium company. Get off your arse JB and start building mines. You have two dead set no brainers in Tumas and Mulga and you're just sitting at the Club chomping on cigars. Hop to it!!

Updated MRE this month at Mulga might be good news.

 

[Sean K]

By adding in the other minerals to the U3O8 eqiv they've halved the grade on the M&I numbers. Heaps more tonnes, but half the grade. Not sure if that's very smart when no one gives a rats about Ni, Co and Zn. Dumb, in fact. Insiders thought it was dumb too.

 

[Sean K]

As expected, CR in the works. Wouldn't mind to participate if it's at a discount although you can usually pick up shares on market when it inevitably tanks 10%. Might be a good opportunity since POU has corrected as has this by quite a bit. No change to the uranium narrative that I can see.

This is probably just a top up of the treasury to pay the executives their annual bonuses but maybe they'll claim it's cash to fund up to FID for Tumas or to complete the DFS at Mulga or some rubbish to kick the can down the road a bit more.

 

[Sean K]

Holy smoke Batman.

$220m @ $1.225.

TBC, but my Uber driver said, so I'm pretty sure.

(edit - it's in the bible)

 

[tech/a]

This is also on the watchlist awaiting a trigger.

 

[Sean K]

I wasn't keeping track of the short side on this. Explains the large drop compared to some of the others.

Good tactic shorting something coming up for a CR if the usual discount is applied. In this case, the shorters might be caught short.

We got em – But not really​

Deep Yellow shares entered into a trading halt before Thursday market open. The company said it was "in the process of finalising arrangements in relation to a capital raising."

According to the Financial Review, the company is seeking to raise $250 million at an offer price of $1.225 per new share. "Bulk of the proceeds, $220 million, are earmarked to fund the development of Deep Yellow's wholly owned Tumas project in Namibia, which has guided to 3.75 million pounds in annual capacity," notes the article.

The $250 million raise represents a relatively large sum compared to the company's $975 million market cap, yet the new shares will be issued at a negligible 3.9% discount to its last close.

Typically, capital raises offer new shares at discounts between 10-20%. This narrow discount suggests robust investor demand for both Deep Yellow shares and exposure to uranium.

Deep Yellow shares could even open in positive territory if uranium stocks and prices for the commodity push higher before the stock resumes trading.

Food for thought​

What are short sellers lingering around for now that the capital raise thesis is done and dusted?

Short interest among local uranium names isn't particularly high. Some of the top shorted ones include (# rank among shorted stocks):

• #38 SILIEX Systems (ASX: SLX): 4.28%
• #101 Paladin Energy (ASX: PDN): 2.14%
• #106 Boss Energy (ASX: BOE): 2.04%
• #270 Lotus Resources (ASX: LOT): 0.64%
• #375 Peninsula Energy (ASX: PEN): 0.20%

 

[Sean K]

Ignoring the SPP at 1.225 and bought more lower. Good SPP! LOL

 

[dyna]

Yeah. Some discount. A big fat Zero !
Don't think I'll bother .
$250 Mill . raising. Most of it with the Insto's $ 140 mill. placement , then $ 80 Mill. in a 2nd tranche , followed by the $ 30 Mill . share purchase plan for the mums and dads .
When you think about it , the pro's and superannuation fund managers probably couldn't get the volume if they tied to get that number of shares on - market .
We small players have the advantage , there . ( Just have to be on the ball , that's all )
At least it tells us , the demand for shares in the company , is there. You would like to think the big shots have done their due diligence .

 

[Sean K]

While I managed to pick a bottom after the CR announcement I guess I'll participate in the SPP at $1.225 as well. Unless POU tanks in the meantime.

 

[dyna]

Mmmm , offer closes 5 pm next Monday . better do the B pay right now , then .

The SPP will allow each holder up to$ 30, 000 but I'd expect a scale back for anyone trying make a quick buck . ( 44 cents instant profit for the taking , there )
Already got 10 grand worth so I'll just try for another ten . That will do for me.

 

[dyna]

Well , I just had a brain fart and put 30 big ones on the barrelhead.
Just curious now , to see how big the scale back will be .
Then again , if all the mums and dads don't cough up the dough , the shortfall just gets hoovered up by the Insto's at the same $ 1.225 . ....No scale back , after all ! ( Could be trying to be too clever , here ).......We'll see .