Yellow Cake Share Discussion Threads

[7kiwi] 05/9/2021 19:32

Barclays now promoting nuclear power.

[return_of_the_apeman] 04/9/2021 21:27

@7Kiwi - I am not calculating it as acurately as you :-)

Thanks for sharing your spreadsheet

[dartboard1] 04/9/2021 11:13

In fairness that's a 2% premium which is basically NAV ... give or take

[7kiwi] 04/9/2021 10:18

r_o_t_a,

How are you calculating your NAV? I make it £2.99.

[jonwig] 04/9/2021 09:51

return_of ...

I don't know whether YCA actually has a mandate for ATM share issues. What it does (a placing whenever there's a premium) is a bit clunky. Maybe it could get a mandate from shareholders, or maybe it would have to register as an investment trust. I don't know.

[return_of_the_apeman] 04/9/2021 09:08

Perhaps a bit of caution around miners is currently warranted (though I am not seeing any out there) as valuations for uranium miners are getting ahead of themselves in anticipation of spot being $50-$60, may be a bumpy ride for them

I am expecting that savvy uranium investors will at some point re-balance from miners to physical when they believe miners are finally too frothy and we may find miners falling while spot continues to rise

Most of this will be into sput, however better value is likely to be available here
Currently Sput trading at a 11.39% premium to nav, YCA only at nav

We shall see

[return_of_the_apeman] 04/9/2021 00:37

$39 spot
305p nav

Perhaps more noteworthy is that the amount of spot purchased by sput is growing rapidly, driven by demand

Sput purchase volumes (in lbs) for the last 4 days (approx.)
250k
500k
800k
1.4m

[7kiwi] 03/9/2021 16:34

Cantor Fitzgerald ups its target for YCA:




If it hits 375p, that would be equivalent to $49/lb if there's no premium. That would be even more rocket fuel for the equities.

[return_of_the_apeman] 03/9/2021 16:28

Indeed if that sort of capital flowed in, the spot price would be north of $200, we can but dream

I don't use reddit either, had a quick look, most of the posts in wsb seem very bullish but historical - given that this setup has been coming for a few years now that's probably not supprising

Something will be the catalyst to a massive correction in this market, perhaps it will be sput

[7kiwi] 03/9/2021 14:38

I agree apeman.

I don't follow Reddit, but I wonder if the WSB crowd are starting to get in.

The whole Uranium sector is probably worth less than Gamestop at its peak.

[return_of_the_apeman] 03/9/2021 14:15

Thanks for your detailed posts 7Kiwi

You say US inventories are getting very thin and I believe we can all see the ATM nature of SPUT is driving the spot price up daily - my guess is spot to be up above $39 today. If SPUT continue to buy at the current rate they will have increased demand in the US by circa 40% by xmas.

Wondering when utilities begin to jump to secure new supply contracts and if the US ones will be first perhaps leading to a dominio effect for utilities across the globe. I would not like to be caught napping and be the last utility to secure supply and would see little downside being the first at the moment in my niave understanding
The World Nuclear Association Symposium is meeting next week, perhaps that will focus the utilites minds

Twitter #uranium is gaining traction fueling money into mining etfs and sput at record rates

A squeeze is definitely happening now

Gla

[thelongandtheshortandthetall] 03/9/2021 08:59

Thanks again 7kiwi.

Listening to the vid now yupawiese2010.

If Sprott keep taking money in, they can keep buying and stacking - further increasing the price and in turn the attraction of the Sprott vehicle.

A perfect storm perhaps :)

[yupawiese2010] 03/9/2021 08:32

Interesting interview with Justin Huhn, well worth listening to, lasts just over an hour.

[7kiwi] 03/9/2021 08:32

lst,

Covid had an impact. But not really any more.

Cameco have shut in MacArthur River and KAP are producing 20% below the target of their subsoil user agreements. They recently announced they will do that until 2023. They are deliberately doing that to bring the market back into balance.

Primary production is about 125mmlb/yr. Secondary supply is +/-25mmlb. Demand is 170-180mmlb. Up to now the gap has been met by consuming inventory. At some point that inventory has to run out, or go below levels that the utilities consider "safe". They need about 2 years of inventory to cover the lead time for fabrication of fuel.

It's difficult to get accurate global figures. But in the US, commercial inventories held by utilities were 107mmlbs in 2020, just above 2 x annual demand of 45-50mmlbs. Supplier inventories were 16mmlbs.

The supply deficit is continuing this year, so at some point, there is going to be a squeeze.

See Table S3a:

In the EU utility inventories were 2.75 yrs at the end of 2020. EU inventories have fallen each year for five years. They are well covered by contracts until 2025.

I can no longer find a link to the Euratom Annual Report 2020 online. But I did download one to my laptop earlier this year.

So, it looks like the US inventory is getting very thin. EU less so.

[thelongandtheshortandthetall] 03/9/2021 07:39

Anyone reckon Uranium is showing signs of a lack of supply (possibly covid related) and buyers mopping up what they can in anticipation of problems ahead.

[quepassa] 03/9/2021 07:19

Sector bellwether Cameco hit a 10 YEAR HIGH on the TSX in yesterday's session at just over C$26

Excellent news for the sector and outlook.


GLJ Research have also increased their BUY RECOMMENDATION and price target on Cameco from C$27 to C$38 citing increasing demand.

ALL IMO. DYOR.
QP

[return_of_the_apeman] 03/9/2021 00:36

Spot now $37

Nav at 289p

[thelongandtheshortandthetall] 02/9/2021 20:02

Cheers 7Kiwi.
Informative post there.

[7kiwi] 02/9/2021 19:29

lst,

Sprott certainly are making a difference. However, both Cameco and Kazatomprom have said that they will need to access the spot market to meet their contractual commitments for the balance of this year. Plus a significant amount of utility requirements are met from spot purchases as opposed to long term contracts.

So, it looks like Sprott has been enough to tip the spot market into a bullish phase. There's an overall structural supply deficit, and once the excess inventories are depleted, I expect a spike in the U price. Trouble is, the market is somewhat opaque, so we never quite know how much inventory is being held. So, this might be a temporary surge, or it may be the real deal. Only time will tell.

[thelongandtheshortandthetall] 02/9/2021 18:30

In all seriousness I guess green electric generation is all go - esp with the EV revolution.

[thelongandtheshortandthetall] 02/9/2021 17:50

So are Sprott going for a decent, late 18th Century, cornering of the Uranium market?

[7kiwi] 02/9/2021 16:10

I think that's a new all time high close at 285.

[bmcb5] 02/9/2021 12:16

@Ptolemy - nice timing!

I've updated the header to add one more chart. The previous mega spike actually involved 2 years of steady increases (don't know how granular that data is). I suspect the move coming over the next few years will be more violent, but would happily accept the same pattern again. Patience, combined with controlling excitement, is going to be required.

Surprised this is still at a discount to NAV though

[andyforster1] 02/9/2021 06:52

A well respected bloggers view on uranium https://adventuresincapitalism.com/2021/09/02/the-new-gbtc/

[return_of_the_apeman] 01/9/2021 20:26

Nav now up to 278.2p :-)

Spot $35.63