NTU - Northern Minerals

[nioka]

Re: NTU - Northern Uranium

This is very good for existing holders, I wish that I was one of them but im not as yet.
Ive been waiting to see a good entry point in the last week, but it hasn't presented itself yet.
I will be hoping for some consolidation after some short selling after the topups occur hopefully I can get in at about .21 in a couple of weeks time.
good luck to all holders
DYOR

Todays price plus the issue rights is not far off an average of your 21c. Even with this issue the company will not have an excessive market cap bearing in mind the potential given the rare earth shortages and price increases.

 

[Huitzii]

Re: NTU - Northern Uranium

Todays price plus the issue rights is not far off an average of your 21c. Even with this issue the company will not have an excessive market cap bearing in mind the potential given the rare earth shortages and price increases.

After doing a bit of maths on this one I came up with a share price of .18 after the issue.
currently 49M shares plus 40% (2 for 5) = 68.6M shares
Close before trading halt was .26 CPS
49M x .26 = $12740000
12740000 /68.6m = 0.185 CPS
This is without factoring in any premium on the MC of 26M

If I was to use only the the MC
26M/68.6m shares = .37 (currently undervalued)

Does this make sense as I'm only new to this sort of evaluation and now ive confused myself lol

 

[KurwaJegoMac]

Re: NTU - Northern Uranium

After doing a bit of maths on this one I came up with a share price of .18 after the issue.
currently 49M shares plus 40% (2 for 5) = 68.6M shares
Close before trading halt was .26 CPS
49M x .26 = $12740000
12740000 /68.6m = 0.185 CPS
This is without factoring in any premium on the MC of 26M

If I was to use only the the MC
26M/68.6m shares = .37 (currently undervalued)

Does this make sense as I'm only new to this sort of evaluation and now ive confused myself lol

Here's what I got for the value of your shares after the dilution:

49M existing shares at $0.26 $12,740,000
19.6M news shares for $0.16 $3,136,000
Value of 68.6M shares $15,876,000
Ex-rights value per share $0.231 ($15,876,000/68.6M shares)

Sourced the calculations from:

http://www.investopedia.com/articles/stocks/05/062905.asp

Good overview of rights issues too if you're interested.

 

[nioka]

Re: NTU - Northern Uranium

After doing a bit of maths on this one I came up with a share price of .18 after the issue.
currently 49M shares plus 40% (2 for 5) = 68.6M shares
Close before trading halt was .26 CPS
49M x .26 = $12740000
12740000 /68.6m = 0.185 CPS
This is without factoring in any premium on the MC of 26M

If I was to use only the the MC
26M/68.6m shares = .37 (currently undervalued)

Does this make sense as I'm only new to this sort of evaluation and now ive confused myself lol

You have to make adjustment for the value and the benefit of the extra cash. There is dilution but there also is a bigger and better funded company. The need for a cap raising was partly factored into the SP before the announcement was made. There was always the thought that a new issue would be made to sophisticated investors and not to shareholders. The fact that shareholders were given the discounted shares was a better outcome that most expected so the SP was probably a little lower that it could have been if this had been known earlier.

I look at it as a plus. A chance for some cheap new issue shares and a chance today to buy both options and new shares that will also carry the rights to more new issue shares. I have taken that upoday.

 

[nioka]

Re: NTU - Northern Uranium

Here's what I got for the value of your shares after the dilution:

49M existing shares at $0.26 $12,740,000
19.6M news shares for $0.16 $3,136,000
Value of 68.6M shares $15,876,000
Ex-rights value per share $0.231 ($15,876,000/68.6M shares)

Sourced the calculations from:

http://www.investopedia.com/articles/stocks/05/062905.asp

Good overview of rights issues too if you're interested.

I came up with 23.5 as my buy price today. Tried to jump the queue by offering 24.5 and had my order filled at that price (24.5). A cent or two here or there will not matter much in the long run. I'm expecting it to perform well. Lynas are no beginners in this game and that is a confidence booster for me.

 

[KurwaJegoMac]

Re: NTU - Northern Uranium

I came up with 23.5 as my buy price today. Tried to jump the queue by offering 24.5 and had my order filled at that price (24.5). A cent or two here or there will not matter much in the long run. I'm expecting it to perform well. Lynas are no beginners in this game and that is a confidence booster for me.

You're quite right - a few cents either way won't matter in the long run. I've been accumulating NTU up to 0.26 currently and depending on how drilling goes next month I may upsize my position.

Holding Lynas too

 

[Huitzii]

Re: NTU - Northern Uranium

Here's what I got for the value of your shares after the dilution:

49M existing shares at $0.26 $12,740,000
19.6M news shares for $0.16 $3,136,000
Value of 68.6M shares $15,876,000
Ex-rights value per share $0.231 ($15,876,000/68.6M shares)

Sourced the calculations from:

http://www.investopedia.com/articles/stocks/05/062905.asp

Good overview of rights issues too if you're interested.

Thanks for that link,now i can see how it works.
With a market cap of 24m does this make them undervalued?

 

[KurwaJegoMac]

Re: NTU - Northern Uranium

Thanks for that link,now i can see how it works.
With a market cap of 24m does this make them undervalued?

Not necessarily - just because it has a low market cap, doesn't make it undervalued. You need to compare it with other companies and see what their market cap and fundamentals are.

So for example lets take NTU and ABC where ABC is some sort of uranium mining company similar to NTU.

If you just looked at MarCap:

ABC: $31m
NTU: $24m

You only know that NTU is valued at less than ABC - does this make it undervalued? Not necessarily - it makes NTU cheaper than ABC but without knowing why it's cheaper you can't conclude that it's undervalued.

As a very, very basic example, lets say you compare those two using profit (i'm using fake figures here):

ABC: Profit = $2m, MarCap: $31m
NTU: Profit = $2m, MarCap: $24m

Here you can see that both ABC and NTU are earning the same amount of profit per year, but NTU is significantly more cheaper than ABC. Does this make NTU undervalued? Not necessarily It's undervalued from a pure profit perspective, but it could have less assets than ABC or it's earnings forecast may have dropped, or some other announcement has been made to bring down it's SP - conversely ABC may be getting yoy growth of 10% compared to NTU at 2% which would be why ABC could have a higher market cap (better future earnings potential), etc., etc.

So you can't draw a conclusion straight from market cap - you need to have a look at the company fundamentals more broadly. That being said, the market cap is a useful filter to ensure you're comparing similar sized companies - you wouldn't compare the fundamentals of a $2 billion market cap company to a $20 million market cap company.

 

[nioka]

Re: NTU - Northern Uranium

Anyone holding NTU can smile today. The SP is rocketing. While the options have increased they are lagging well behind the heads and are the cheapest entry but the gap is widening by the minute. Something must be going on behind the scenes. a speeding ticket must be around the bend. NTU is definitely one to watch.

 

[KurwaJegoMac]

Re: NTU - Northern Uranium

Anyone holding NTU can smile today. The SP is rocketing. While the options have increased they are lagging well behind the heads and are the cheapest entry but the gap is widening by the minute. Something must be going on behind the scenes. a speeding ticket must be around the bend. NTU is definitely one to watch.

Indeed! The stock just rocketed out of nowhere. I was thinking it would consolidate for a couple of weeks around 2.3 because of the rights issue. Somebody wants this stock bad!

 

[AngusSmart]

Re: NTU - Northern Uranium

So didnt expect that to happen today. i jumped in on Lyc instead for a quick day trade and am happy.

Ntu is always on the cards however.. but on the back of the share announcement i didnt see this happening.

any particular reason for this massive jump today?

 

[KurwaJegoMac]

Re: NTU - Northern Uranium

Been looking around and haven't managed to find any news.

Could potentially be momo investors as the stock has been ramping up the past few weeks - although I would have thought Friday's drop would have dampened their appetite and kept the SP around the new diluted value.

Could be a case of people in the know accumulating or just rampant momentum investing. Either way, tricky bit is working out when to jump ship

 

[Southern X]

Re: NTU - Northern Uranium

Kurwa you wrote:

ABC: Profit = $2m, MarCap: $31m
NTU: Profit = $2m, MarCap: $24m

While this applies to companies with positive cash flow I can't see how it would apply to an exploreco. Therefore another set of metrics must be employed, eg. NPV, EV/pound, (both of which I'll have to learn to calculate).

NTU's sp will continue to rise once good HREE drilling results are released. For now it's a pure speculation, but with LYC having a substantial position, and the Chinese seemingly squeezed out, NTU is being de-risked.

SX

PS Has anyone noticed the gold sp feeding frenzy in the Yukon? I've got ATC:TSX-V, SMD:TSX-V, and VIT:TSX. Sometimes life is good!

 

[KurwaJegoMac]

Re: NTU - Northern Uranium

Kurwa you wrote:

ABC: Profit = $2m, MarCap: $31m
NTU: Profit = $2m, MarCap: $24m

While this applies to companies with positive cash flow I can't see how it would apply to an exploreco. Therefore another set of metrics must be employed, eg. NPV, EV/pound, (both of which I'll have to learn to calculate).

You're quite right in this regard Southern X - however I'd like to stress that I was using 'profit' just to illustrate a point, rather than as a viable metric to use in comparisons. As with all investments, DYOR - it's up to the individual investor to determine appropriate metrics to compare.

NTU's sp will continue to rise once good HREE drilling results are released. For now it's a pure speculation, but with LYC having a substantial position, and the Chinese seemingly squeezed out, NTU is being de-risked.

Indeed - it's pure spec until drilling results are released. Thankfully they commence drilling soon

 

[Southern X]

Re: NTU - Northern Uranium

KurwaJegoMac,

Forgot to mention, thanks for the investopedia link.

Wish I'd had it for Richfield Ventures, RVC:TSX-V, which this past January to March I was watching like a hawk. I made calculated a crude, and in the end ineffective entry point.

SX

 

[KurwaJegoMac]

Re: NTU - Northern Uranium

No worries

Sorry to hear about Richfield Ventures, hopefully it didn't set you back too much!

 

[Southern X]

Re: NTU - Northern Uranium

Poorly worded concerning RVC. Meant never entered, and missed a double.

SX

 

[KurwaJegoMac]

Re: NTU - Northern Uranium

Closed out today, not liking the strong sellers at the upper end of $0.3 - a bit too big a surge with little information available as to why.

Was thinking maybe it was some sort of insider knowledge but then I would have thought that insiders would have tried to get in before the rights issue (which has left a huge spread between the current SP and the current options price).

I'm forecasting a drop to $0.250 -0.3 which i'll probably buy in again at that stage. If i'm wrong, i'll just exercise my rights so no big loss

 

[Fed23]

Re: NTU - Northern Uranium

hey guys,

I have been watching this stock and would like to ask if I jump in today or tomorrow, am I entitled to the 2 for 5 option? (what does 2 for 5 mean by the way, dont bash me)

thanks

 

[KurwaJegoMac]

Re: NTU - Northern Uranium

hey guys,

I have been watching this stock and would like to ask if I jump in today or tomorrow, am I entitled to the 2 for 5 option? (what does 2 for 5 mean by the way, dont bash me)

thanks

If you buy today you willbe eligible for the rights issue. You have to be a shareholder on the record date which is 17th Sept. You have to pay for the rights by 13th Sept.

So essentially 13th Sept is the last day you can buy the shares, then you have to hold them until the end of 17th Sept to be eligible.

A 2 for 5 issue means you will get two shares for every 5 that you own