WME just published the complete Report.
That means together with Fat Prophets we now already have two independant research companies who recommend this stock and are covering it in the future.
http://www.wametals.com.au/investors/research_pdfs/090713_hansonwesthouse.pdf
Here are the most interesting excerpts:
...We are beginning to see more M&A activity in the sector and we see clear synergies between WME and Areva at Trekkopje. At a price of US$5.9 per lb, WME would be valued at A$208.36m or A$0.57 per share (not including any upside from the company’s other projects)...
...The involvement of Polo is significant as Stephen Dattels and managing director Neil Herbert have a very strong track record in the uranium sector. Both were directors of Uramin, which they sold to Areva for US$2.5bn in 2007. Uramin’s primary asset was Trekkopje, which is very similar in mineralisation and is just 30km south of WME’s primary project at Marenica.
The additional funding further diluted the existing shareholders until they now lack the influence to control the board. This has allowed the new board to create some stability for the company....
...Since 2006, WME has completed 38,000m of Reverse Circulation (RC) drilling and delineated a 34.3Mlb Inferred JORC resource at an average grade of 140ppm U3O8 within the paleochannels (see figure two). Most rock fragments within the paleochannels are angular in shape, suggesting that they have not travelled far from their origin...
...WME expects that the results of these studies should be complete by the end of August/early September 2009 and will be closely followed by a resource upgrade at the end of September. Once this is complete, SRK will begin an initial scoping study in October which should be complete in November/ December...
...Given Marenica’s close proximity to Trekkopje, and Polo Resources’ recent investment in WME, there has been growing speculation that a sale or JV with Areva would be the most likely exit route. Indeed, last week, Areva CEO Anne Lauvergeon stated on France's Radio Classique that it could look at buying mining or renewable energy assets...
...Deep Yellow has a slightly lower valuation as it includes some non-code compliant resources. However, we believe that both Bannerman and WME are substantially undervalued. Bannerman has suffered over the past year due to major shareholder, Opes Prime, being forced to sell 9.6% of the company last year. In addition, litigation with Savanna Marble CC and other parties, which could have meant Bannerman losing the Etango license, have impacted the company. These were only resolved in December 2008.
Boardroom changes and consequent lack of focus led to a similar devaluation in WME. However, with the new board, new investors and the recently announced drilling program, we now believe such views are unjustified. In relation to its peers, we would expect to see WME valued at A$129m or A$0.35 per share. This does not include any ascribed value for its other projects...
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