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Re: MTN - Marathon Resources

Do you guys think there'll be much resistance at the $2 mark?

Would any of you risk buying in now or do you think there are other better U stocks? I've been playing bannerman but sadly sold out a few days before the push past $2 and am too cautious to get back in.

Looking at the chart I have here the support figure seems to be back at $1.50. Does anyone else agree that that is a reasonable risk assumption? Still 25% would suck. Hence my reluctance to enter this at the moment. Comments appreciated. Thanks guys.
 

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Re: MTN - Marathon Resources

I agree BCF, must be very hard to enter this with confidence right now. Looks like resistance at $1.95ish yes, and next support probably at $1.50. There must be some punters taking profits at the moment. Market cap still isn't that really demanding at under $100m I think (need to check), with the potential resource they have at Mt Gee. A possible option might be to buy in incrementally instead of all your cash in at once. If it keeps going up buy a little more, if it fails you haven't lost the house. Perhaps. I've owned this for a little while, but personally I would be concerned about buying at these levels. I'm even thinking of taking some profits. I have this in my top 3 potential U plays at the moment with SMM and AGS. (holding all) My , others might be more bullish on the whole uranium thing at the moment and just slap a buy on anything they own. Good luck.
 
Re: MTN - Marathon Resources

agreed. do some research and sort the potential stocks from the explorers.

IMO there are a very small number of uranium plays in australia that will make it to production. SMM, MTN and AGS been them.

still very low market cap when compared to other uranium stocks however. divide market cap by pounds of u to get a valuation on a per pound basis.

there may be some anticipation in regards to a resource update. i think there are a few who are expecting some bumper results.
 
Re: MTN - Marathon Resources

i would see this IMO as a buy when it breaks above 2.00 on confirmed breakout. prob a psychological barrier around the 2.00 mark. beyond that i would like to see strong support form around 2.00.

downside is 1.50 however it took quite a few attempts to break that point so should see strong buying support at those levels.
 

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MTN Marathon Resources - Uranium in SA

Marathon has 45.6 Mt @ 0.068% U308 (31,250 t U308 @ 0.68 kg/t) in South Australia. This is a respectable sized deposit and SA is a Uranium-mining friendly state. At the time of writing they are doing resource drilling to upgrade the JORC status from inferred to indicated or measured. They have had drill hits of around 1kg/t over 2-3m during drilling. They are the target of an off-market takeover from Crosby Capital, the same outfit who made the lowball attempt to takeover Tethyan Copper. Their offer is pitched at 68c compared to the current share price of 200c. On a market-cap per unit of uranium in the ground, they are an order of magnitude cheaper than Nova (NEL), Summit (SMM) and Energy Metals (EMM). Of course NEL and SMM have the added disadvantage of being in uranium-unfriendly states. If you want to verify this for yourself, here's the raw data which you can import into Excel as a CSV file (copy and paste the data into a text file using notepad first, then save the notepad file as "blah.csv"):

Company,U308 (t),Grade (Kg/t),Price ©,shares,Mkt Cap ($M),Cap/Lb ($/lb)
MTN,32250,0.6,200,"43,430,000",87,1.2
ARU,3954,0.21,50,"58,132,507",29,3.3
EME,3800,2.1,388,"12,020,750",47,5.6
VUL,20000,1.8,145,"120,000,000",174,4.0
OMC,4950,0.4,50,"101,605,000",51,4.7
GGY,1200,2,7.5,"247,727,528",19,7.0
RPT,7860,0.52,16,"565,689,000",91,5.2
NEL,9000,0.6,305,"57,050,001",174,8.8
SMM,20000,2,320,"197,440,020",632,14.4
PDN,40000,0.7,800,"497,000,000","3,976",99.4
 
Re: MTN Marathon Resources - Uranium in SA


xgeo, The first figure I tried to corroborate here was the 20000 t U that you say SMM have which is about 44m lb U3O8.

SMM currrently have 57m lbs JORC in a 50/50 JV with PDN in the IUJV, which brings their component to 28.5m lbs. They have about 8 other projects to be JORCed shortly.

How can I trust any of the other figures?
 
Re: MTN Marathon Resources - Uranium in SA


Thanks exgeo,

I'm new to fundamentals, but just looking at your data it seems:
  • MTN has 10% shares listed as PDN for a 75% size/grade resource
  • MTN sp is 25% of PDN
- this implies each share has 7.5x value of resource backing for 1/4 of the sp, ie a value advantage of 30x !!??

How's my maths?
 
Re: MTN - Marathon Resources

On page 6 of SMM's latest annual report it is stated that the company "controls over 70 Mlbs" of JORC resources. This is 31,800t U308. It is not made clear whether this means 100% control. Even assuming they have only 50% of that amount (ie/ 16,000t) there seems little doubt that the resource will be upgraded very substantially given the intersections they've been reporting thoughout the year. I would encourage anyone to verify for themselves any information they read on this site before making an investment.

If SMM win the court case that they are prosecuting against Resolute then they may end up with 100% of the IUJV, or at least an "option to purchase the other 50% interest on commercial terms".

It seems EME may also report a significant resource increase due to recent drilling having extended the Bigyrli deposit down dip. MTN's overall tonnage may not change that much as they drilling mainly to increase the level of confidence in the existing resource, not extend it. But they are a lot cheaper to start with, and don't have political problems. NEL may also increase the resource tonnage a bit, but not by more than 10-20% I would guess. They are also drilling to increase the level of confidence and fill in some gaps in the previous drilling which may of course lead to a tonnage increase. As a guide to the prices companies are putting on resources in the ground, you can look at the values of Redport and Valhalla when they were taken over (the SP and no. of shares listed in my data). Of course the U308 price has increased substantially since then partly due to Cigar Lake in Canada flooding and delaying the opening of this new mine which was supposed to open in 2008.
 
Re: MTN - Marathon Resources

Thanks for the info exgeo (ex geologist?)

That's the problem with rating a lot of these explorers at the moment as many have results to be JORCed in the comming weeks/months and they contiue to drill to extend their projects. Perhaps the reason why someone like PDN has a higher ration of lbs to market cap is because they are actually about to produce. Also, perhaps SMMs is so high because they actually have a JORC and have another 6-8 on the way? There seems to be a lot of vaiables when trying to come up with the best value, or most undervalued stock in the U sector at the moment....I'd like to be able to see which has the most potential relative to market cap to make a decision on what to buy.

(U holdings: SMM, AGS, MTN, WME, BMN, EXT, BHP)
 
Re: MTN - Marathon Resources

Well as you can see from my (as pointed out, imperfect!) market cap/lb listed above, MTN is the cheapest out of the ones I researched. This research was done over Christmas 2005 and has been updated as new info came to my attention. A reader could use it as the basis for their own spreadsheet and add their own stocks- my reason for posting it was just to highlight a method of ascertaining relative value.

Comparing the explorers to PDN one can see what might happen if any of them ever get into production! NEL currently have GRD Minproc working on a feasibility study on their Lake Way deposits (GRD did the engineering for Langer Heinrich). By the way, I am a former geologist, and worked for Acclaim Uranium until 1999. Acclaim (subsequently renamed Aztec Resources) sold Langer Heinrich to PDN for "the price of a cut lunch" as I saw one other poster on this forum write! I also did limited work at Centipede (NEL) and various other calcrete uranium projects around WA. Since 2004 I've been mining the stocks market for profits instead of kicking rocks.
 
Re: MTN - Marathon Resources

You're input here is much appreciated exgeo. Cheers.

LOL about you working for Acclaim. I've held them on and off for 10 years. My first foray into them was when a 'friend' told me (not a cabbie) that a 'friend' of theirs was a geo for Acclaim and they had hit some gigantic gold deposit in WA that would send it's sp from $0.05 to $1.00!, and it was going to be ann shortly. I subsequently told all my friends, and even my dad bought some. It went up about 5% after the ann and then crashed down again. I'm now holding AEX again. I forgot to include it my above list.

Getting back to MTN, I have done similar calcs to see which might be the most undervalued U play atm and I tend to agree that MTN might be one of the better ones considering resource to market cap. That's why I hold it.

I'll try and download your speadsheet there and maybe update the figures to take in any recent anns.

Thanks.
 
Re: MTN - Marathon Resources

yes, of course all these things are moving targets, as they announce resource increases and so on. The idea is not to say one company is 10% cheaper than another, merely to spot glaring "order-of-magnitude" anomalies such as how undervalued MTN is compared to other uranium companies.
 
Re: MTN - Marathon Resources

Exgeo, I am glad you are in your name sake, May I ask you a couple of questions about MTN:
1. Since they have drilled a few holes, can they do the scintillometer log to measure radiation of each hole, and calculate the eq. ore grade? I guess by doing so, we can have a quick results

2. How accurate that their resources model is, and how good is their geology interpretation for Mt Gee Area is?

Thanks.
 
Re: MTN - Marathon Resources

LOL. I took profits on MTN yesterday and what do you know - ann released with some outstanding new interesection which will probably significantly increase the resourse!!
 
Re: MTN - Marathon Resources

kennas said:
LOL. I took profits on MTN yesterday and what do you know - ann released with some outstanding new interesection which will probably significantly increase the resourse!!
Click to expand...

Its always the way Kennas....lol

A big buy went through yesterday morning & also in the previous week......I thought something was up....
 
Re: MTN - Marathon Resources

great results from MTN today. drill sections have identified larger extent of high grade and very thick mineralisation along north west end of resource.

IMO i think this one will be a lot larger than 69 million pounds once fully drilled. remember this is only the first results. a lot more drilling to go but resource remains open in all directions.

hasnt been a huge increase on sp as anticipated. market cap is still around 100 million which considering resource and uranium friendly state is still undervalued when compared to MTN peers.
 
Re: MTN - Marathon Resources

Would have to agree here dj. Some of those grades make it better quality than Beverley 4 Mile, but not sure how the depths make it, or the type of deposit make it....

(not holding MTN now )
 
Re: MTN - Marathon Resources

what to you make of the current market depth?
doesn't look like it will break $2 today, probably bad timing with the release of the result... on a normal Uphoric day, and this would have flown!

probably gives you time to get back in Kennas, if you haven't re-invested the cash elsewhere...
 
Re: MTN - Marathon Resources

I'm using the money to buy bandaids for my BDG wounds.....

You're right, last week this ann would have sent it up 20%. Was up there for a little while but came off.....
 
Re: MTN - Marathon Resources

1/ Marathon's resource model up to date looks pretty conservative to me. It seems like they've excluded some large areas of former drilling from the resource calculation because the drilling density was not great enough to include this area, despite indications of mineralisation. This is one of the aims of the current drilling.

2/ As can be seen from Today's announcement, MTN are using gamma logging (the eU308 values- "equivalent U308") to determine in-situ grades and confirming the results with chemical assays. If disequilibrium has occurred (if the deposit is very young for example) then the gamma logging may not give the correct U308 values, hence the chemical assays as a confirmatory check. This will also serve to check the calibration of the logging tool as well.

The poster who mentioned that the grades are higher than 4-mile well is comparing apples and pears. 4 mile/Beverly will be an ISL (In-situ-leach) mine in all probability. This means they only have to drill some wells and inject an acid solution which dissolves out the uranium. A central collection well then extracts the uranium solution. MTN's deposit is hard-rock (haematite breccia) and needs to be physically dug up, necessitating an open pit or underground mine, depending on depth. Obviously this costs more.
 
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