Below is yesterday report from Bell Potter, rather positive,...

Below is yesterday report from Bell Potter, rather positive, with a BUY recommendation and a $4.25 price target.

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Kayelekera approaches nameplate
„ PDN reports March quarter production
PDN produced 1.40Mlb's in the March quarter, -4% q/q and 6% below UBSe of 1.49Mlbs. Production was slightly ahead of our estimates at Kayelekera, which is a positive, but Langer Heinrich production was 11% below UBSe due to high
rainfall during the quarter. March production at Kayelekera averaged 93% of nameplate. PDN has updated production guidance to 6.0Mlbs +/- 1%, lowered from 6.0-6.3Mlb range previously given, inline with UBSe.
„ Shipments inline with production during the quarter
PDN made shipments of 1.4Mlbs during quarter, which was inline with production. We expect PDN to continue to build inventory, inline with its goal of maintaining 3-4mths inventory at any one time, which needs to increase with PDN?s production growth. PDN's realised price was US$66.28/lb, slightly below spot of US$67.10/lb for the quarter (according to Ux Consulting). PDN achieved record quarterly sales of US$92.5m.
„ Upgrade to Buy. Value evident for investors willing to ride short term risks As the share price is a represents a 23% discount to our NPV, we believe that value has now emerged in PDN. We are upgrading to a Buy rating with a $4.25 price
target (prev. $3.75) based on a 10% discount to NPV. Our Buy rating is not without risk. We highlight that there remains significant uncertainty around the impact of the Fukushima disaster on the long-term demand for global Nuclear power generation.
„ Valuation: $4.71 (DCF, 10% d.r. + US$5/lb of undeveloped resource) Our price target of $4.25ps (prev $3.75ps) is based on a 10% discount to NPV