Commodities: Uranium
Hi James and Team
This might arrive too late for Sat Q&A – and if not mentioned in Fri’s PM report can you mention your thoughts on SLX on Monday.
Silex has dropped over 4% this morning from a close of $5.10 to a low of $4.87. Has there been any particular news causing this fall? Is this an opportunity to buy given your long and bullish outlook on SLX.
regards
Happy Lunar New Year Team!
Please advise:
1) where can one find the stocks that currently have SPP open?
2) Does PayPal offer a buy/sell in crypto?
3) Apart from the newly minted Crypto ETF, where can one buy crypto from a reputable organisation without creating own wallet?
4) If Cameco is losing almost US$50/lb on its spot purchases, how would it impact the price of URNM which has a substantial holding in Cameco?
Would it be better to invest in the likes of PDN, BOE & avoid Urnm?
Canadian based Uranium company Cameco (CCJ US) which we recently sold in the International Equities Portfolio fell 7% overnight on their quarterly production numbers and that sent the Uranium sector in Australia sharply lower today i.e. Boss Energy (BOE) -12.69, Paladin (PDN) -7.02% and Penisula (PEN) -6.9%. The decline in local stocks is understandable while it’s also a sign that investors are sitting on one side of the canoe here, making stability an issue.
We liked uranium company PDN because of the huge global belief in nuclear power as the only way to reach aggressive emission goals by 2050 – Australia is an outlier here. The uranium price had already doubled last December. Still, we felt the demand/belief from the likes of the US, UK, and France looking to triple their nuclear capacity by 2023 will maintain the supply/demand imbalance, and this has played out nicely.
PDN +0.41%: Paladin released its December quarter activities report and details of a US$150m debt facility. The restart of operations at the Langer Heinrich uranium operation in Namibia has commenced with first ore being fed to the front end of plant on Jan 20th.
The surge by uranium has been as exponential as the descent by lithium, not many anticipated either move at the start of 2023. While there may be further to go, the relative performance elastic band is stretching, and the possibilities of a snapback are increasing rapidly.
We are amending multiple portfolios.
MM are making changes to the Active Growth & Emerging Companies Portfolios
The rally by uranium has surprised even the biggest bulls like MM; some consolidation now feels overdue, which is likely to take some froth off of the bullish sector.
PDN has corrected ~20% from its late September high, slightly outperforming BOE over the period. Paladin remains on track to reopen its Langer Heinrich mine in Namibia in 1Q2024
