Stock Alert for Uranium Resources Inc. (URRE)
  • Stock Alert for Portage Resources Inc. (POTG)
  • Stock Alert for Greenwood Gold Resources Inc. (GGRI)
  • " />

    Stock Alert for Uranium Resources Inc. (URRE)

    Uranium Resources Inc. (URRE) engages in the acquisition, exploration, development and mining of uranium properties, using the in situ recovery (ISR) or solution mining process. URRE has produced approximately 8 million pounds of U3O8 from five Texas projects, two of which have been fully restored and returned to the land owners. The Company has two fully licensed ISR processing facilities in Texas, Kingsville Dome and Rosita as of December 31, 2009. As of December 31, 2009, the Company owned both producing and undeveloped uranium properties in South Texas and undeveloped uranium properties in New Mexico.

    The Company was founded in 1977 and is based in Lewisville, Texas.

    Share Statistics (30-Nov-10) FY

    2008

    FY

    2009

    %

    Chg

    Q3

    2009

    Q3

    2010

    %

    Chg

    Symbol URRE Revenue, $Mn 18.55 4.67 -74.8% 1.41 0.00
    Current price $3.66 Gross marg. 90.8% 90.1% -0.8% 90.1% 0.00
    52wk Range: $0.38-$3.95 Oper. margin -217.8%
    Avg Vol (3m): 3,028,770 Net margin -142.9% -215.6% 50.9%
    Market Cap. 338.50M
    Shares Outstanding 92.49M EPS, $ -0.19 -0.12 -36.8% -0.04 -0.02 -50.0%

    Source: Reuters.com, SEC Filings.

    Financial Summary

    Since concluding uranium production from its last remaining well fields in Texas in July 2009, URRE no longer have a source of revenue or operating cash flow.  In a filing, the  Company said its highest priority is to maintain a positive cash position while it awaits the return of the uranium market and improved prices. Production ceased in the second quarter of 2009 when it was determined that the best economic decision for shareholders given the price of uranium at the time was to preserve the asset until appropriate margins could be made with the expected return of uranium prices.

    The Company had $6.1 million in cash at year-end 2009 and had $10.5 million at the end of September 2010.  As of December 31, 2009, it had sold its entire uranium inventory and as such, it does not expect any additional sales revenue or related cash inflows for the Company in 2010.

    The Company raised additional capital in June and July 2010 through an underwritten public offering. Under the transactions, a total of 27.14 million shares of common stock were sold in the offering with net proceeds of approximately $10.1 million, after deducting underwriting discounts and commissions and estimated offering expenses.

    The Company raised additional capital in November 2010 through an underwritten public offering. Under the transaction, a total of 8.22 million shares of common stock were sold in the offering with net proceeds of approximately $9.0 million, after deducting underwriting discounts and commissions.

    Source: Latest 10-Q


    Financial Strength (Nov-30-2010) Company Industry Sector S&P 500
    Quick Ratio (MRQ) 1.51 1.67 0.68
    Current Ratio (MRQ) 2.14 2.73 2.11 1.01
    LT Debt to Equity (MRQ) 2.26 24.83 23.74 117.71
    Total Debt to Equity (MRQ) 2.60 27.37 41.05 170.95
    Interest Coverage (TTM) 3.55 0.07 19.18

    Source: Reuters.com, SEC Filings.

    Analyst Consensus

    No consensus recommendations data available

    Source: http://www.reuters.com/finance/stocks/financialHighlights?symbol=URRE.OQ

    Consensus Estimates Analysis


    No consensus analysis data available.

    Source: http://www.reuters.com/finance/stocks/financialHighlights?symbol=URRE.OQ


    Investment Highlights

    Since its incorporation in 1977, URRE has produced more than 8 million pounds of uranium by in-situ recovery (ISR) methods in the state of Texas where the Company currently has ISR mining projects. It also has 183,000 acres of uranium mineral holdings and 101.4 million pounds of in-place mineralized uranium material in New Mexico and NRC license to produce up to 3 million pounds of uranium. The Company acquired these properties over the past 20 years along with an extensive information database of historic mining logs and analysis. None of the Company’s properties is currently in production.

    The Company’s strategy is to fully exploit its resource base in New Mexico and Texas, expand its asset base both within and outside of New Mexico and Texas, partner with larger mining companies that have undeveloped uranium or with junior mining companies that do not have the mining experience of URRE, as well as provide restoration expertise to those that require the capability or lack the proficiency.

    On November 4, 2010, the Company said it entered into a non-binding letter of intent with Cameco Resources, a subsidiary of Cameco (NYSE: CCJ), for a large ranch in South Texas. The agreement, which is contingent on the Company successfully completing a lease agreement with the land owners, outlines a three-phase exploration program that would be funded by Cameco. There is an option for a production joint venture.

    On November 5, 2010, URRE successfully completed the second draw down under its existing shelf registration statement when it closed its underwritten registered offering of 8.22 million shares of common stock at a price of $1.16 per share, including the exercise by the underwriter of an over-allotment option, with net proceeds to URRE of approximately $9.0 million. The Company plans to use the proceeds for general corporate purposes and to fund future potential acquisitions.

    On September 29, 2010, the Company settled a two-year old lawsuit regarding a lease agreement in Texas; and as a result, eliminated costly legal fees while enabling discussions on additional properties with an estimated 250,000 pounds of in place mineralized uranium material.

    No petitions were filed by the deadline to review the June 2010 U.S. Court of Appeals for the 10th Circuit en banc ruling that URRE’s Section 8 property in Churchrock, New Mexico is not Indian Country, thus affirming the authority of the State of New Mexico to issue the underground injection control permit, which was granted to the Company in 1989.

    In October, URI submitted the necessary documents to the U.S. Nuclear Regulatory Commission to activate its NRC License. URI is currently awaiting a determination from the Commission, and once active, the license may be utilized according to its present terms and conditions while pending renewal from the NRC.

    URRE completed drilling on its Section 13 property in Ambrosia Lake in September. Core samples were shipped to an outside laboratory for the purpose of determining the suitability of the property for ISR mining. Results are expected to be completed in December 2010. If the property is not ISR amenable, then it will fall into the Company’s conventional mining portfolio. The Company has approximately 2.4 million pounds of in-place, mineralized uranium material in the Ambrosia Lake district.

    URRE regained compliance with the $1 per share minimum bid price requirement for continued listing on the NASDAQ Capital Market on October 7, 2010.

    “Our 30-plus years in uranium exploration, development, and mining operations, our experience as the only uranium company with approved restoration of an ISR mining operation in the United States and our significant asset base provides us a significant advantage in the uranium industry,” URRE president and CEO Don Ewigleben said in a statement. “Strategically, we continue to advance our properties toward production as we identify new projects and opportunities to grow our asset base, and, importantly, as we establish relationships and develop opportunities to continually grow value.”

    Recent News

    URRE recently said the U.S. Supreme Court has denied the opponents petition to review the March 2010, 10th Circuit Court of Appeals’ ruling that upheld the Company’s U.S. Nuclear Regulatory Commission (NRC) license to conduct in-situ recovery (ISR) uranium mining at the Churchrock/Crownpoint project.

    The report said the NRC license allows for the production of up to an initial 1 million pounds per year from the Churchrock/Crownpoint project until a successful commercial demonstration of restoration is made, after which the quantity of production can be increased to 3 million pounds per year.

    Source: http://www.uraniumresources.com

    Technical Analysis

    Source: http://stockcharts.com

    URRE is trading above its 13-day moving average. This is considered to be the sign of a bullish trend. There is added weight to this indication because the moving average is rising and suggests that there has been buying interest in this stock.

    URRE is trading above its upper Bollinger Band. Relative to recent price action, the stock is currently overextended and due for either a pause or retracement.

    The MACD for URRE currently indicates a strong bullish signal for two reasons. First, the MACD is above the signal line, a 9-day moving average. Second, the MACD is above zero, which implies that the underlying moving averages are trending higher.

    Comparative Analysis

    Company Name Ticker Price per Mrkt. Cap. P/E P/S
    Nov30-2010 symbol Share, $ $ Mn 2010 2011 2010 2011
    Cameco Corp. CCJ 36.27 14.27B 38.59 27.07 6.80 6.10
    US Energy Corp. USEG 4.92 132.75M 70.29 70.29 4.63 4.17
    Uranium Energy Corp. UEC 7.00 425.92M 116.67 17.07 20.04 1.34
    Industrial Metals & Minerals Median 16.64 n/a 9.50 n/a
    Uranium Resources Inc. URRE 3.66 338.50M n/a n/a n/a n/a

    Source: Thomson Financial

    Insider Trading Activity

    NET SHARES PURCHASE ACTIVITY

    Inside Purchases – Last 6 Months

    Shares Transaction
    Purchases n/a 0
    Sales n/a 0
    Net Shares Purchased (Sold) n/a 0
    Total Insider Shares Held 1.83M n/a
    % Net Shares Purchased (Sold) 0% n/a
    Net Institutional Purchases — Prior Qtr to Latest Qtr
    Shares
    Net Shares Purchased (Sold) 14,988,600
    % Change in Institutional Shares Held 28.38%

    Source: Yahoo Finance

    DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS REPORT. We are not registered as a securities broker-dealer or an investment adviser either with the U.S. Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority.  We are neither licensed nor qualified to provide investment advice.

    The information contained in our report should be viewed as commercial advertisement and is not intended to be investment advice.  The report is not provided to any particular individual with a view toward their individual circumstances. The information contained in our report is not an offer to buy or sell securities.  We distribute opinions, comments and information free of charge exclusively to individuals who wish to receive them.

    Our newsletter and website have been prepared for informational purposes only and are not intended to be used as a complete source of information on any particular company.  An individual should never invest in the securities of any of the companies profiled based solely on information contained in our report.  Individuals should assume that all information contained in the report about profiled companies is not trustworthy unless verified by their own independent research.

    Any individual who chooses to invest in any securities should do so with caution.  Investing in securities is speculative and carries a high degree of risk; you may lose some or all of the money that is invested.  Always research your own investments and consult with a registered investment advisor or licensed stock broker before investing.

    Information contained in our report will contain “forward looking statements” as defined under Section 27A of the Securities Act of 1933 and Section 21B of the Securities Exchange Act of 1934.  Subscribers are cautioned not to place undue reliance upon these forward looking statements.  These forward looking statements are subject to a number of known and unknown risks and uncertainties outside of our control that could cause actual operations or results to differ materially from those anticipated.  Factors that could affect performance include, but are not limited to, those factors that are discussed in each profiled company’s most recent reports or registration statements filed with the SEC.  You should consider these factors in evaluating the forward looking statements included in the report and not place undue reliance upon such statements.

    We are committed to providing factual information on the companies that are profiled.  However, we do not provide any assurance as to the accuracy or completeness of the information provided, including information regarding a profiled company’s plans or ability to effect any planned or proposed actions.  We have no first-hand knowledge of any profiled company’s operations and therefore cannot comment on their capabilities, intent, resources, nor experience and we make no attempt to do so.  Statistical information, dollar amounts, and market size data was provided by the subject company and related sources which we believe to be reliable.

    To the fullest extent of the law, we will not be liable to any person or entity for the quality, accuracy, completeness, reliability, or timeliness of the information provided in the report, or for any direct, indirect, consequential, incidental, special or punitive damages that may arise out of the use of information we provide to any person or entity (including, but not limited to, lost profits, loss of opportunities, trading losses, and damages that may result from any inaccuracy or incompleteness of this information).

    We encourage you to invest carefully and read investment information available at the websites of the SEC at http://www.sec.gov and FINRA at http://www.finra.org.

    Leave a Reply

    Your email address will not be published. Required fields are marked *