Today's sell off on great news defies logic in my opinion (today's was the largest trading day in recent memory, probably over the last year). Uranex is down 7% when news confirmed large intercepts of graphite in one hole (143m) at significantly greater depths than ever encountered (beyond 220m) and plenty of graphite in the other 2 holes reported.
THEY NEEDED A DIAGRAM TO PROVIDE SOME PERSPECTIVE TO SHOW THE SIGNIFICANCE OF THIS HOLE IN PARTICULAR.
I expect a correction next week when the traders realise that Uranex is a viable competitor to Triton and Kibaran. Only Kibaran has an off-take agreement to date. Uranex is only valued at a fraction of Syrah (around 8%) with plenty of upside still to be confirmed.
- Today's volume traded was 19.2m units at VWAP of 29.566 cents per share, with the close at 27 cents (clearly manipulation).
- Total volume traded in July 2014 to date is 95.7m units, with the great majority today.
- Total volume traded in June 2014 was only 20.1m units even after securing $5m at 16 cents per share following the issue of 31.25m shares (TRADING HALT 1). These should have been turned over several times by now if the placement holders intended for a quick profit. Uranex is cashed up to ramp up their drilling prior to a JORC.
- Metallurgy is excellent, with relatively clean concentrate at 99.4% graphite. A large portion of the deposit is large to jumbo flake (the ones that are most valuable). Further enhancements are expected.
- EM survey is imminent (95% complete) and expected to be very positive
- Off-take agreement for 100,000t graphite p.a. sealed with a major for up to 10 years of production (TRADING HALT 2)
- Initial JORC to be completed by November 2014.
- PFS to be completed within 6 months
- Only 262m shares on issue.
- UNXO options are well in the money (exercise price of 10 cents) and could provide significant capital (over $21m) for production which looks like it could be fast tracked
- Directors are buying shares
Following an unexpected sell-off today when Buxton flew following a trading halt, I am expecting management to release an updated Investor Presentation to remind investors of how well Uranex is progressing at Nachu. It looks like the significance of today's announcement has been misunderstood.
News flow could follow any day now. I looking forward to an EM survey, quarterly and investor presentation next week. GLTA holders.
(20min delay)