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Three of the UK’s top mining analysts value Berkeley Energia (BKY.L) at over £1 per share

Three of London’s top mining analysts Paul Smith of WH Ireland, Michael Stoner of Peel Hunt and Ben Davies of Liberum have recently published updated research reports valuing the company well in excess of £1 per share.

Paul Smith reiterated his BUY recommendation with an increased target price of £1.28. His note highlights that the Salamanca mine is “a stand out project globally” and one of only a handful of uranium projects worldwide that is financially robust enough to proceed towards construction at currently depressed uranium prices.

Smith notes that the major catalysts to the share price are further exploration success at Zona 7 and additions to the recently signed long term offtake contracts. 

Michael Stoner has an NAV of £1.18 per share and reiterates his BUY recommendation based on a risk weighted NAV of 90 pence per share. “We expect the company to deliver further offtake contracts, the start of construction, debt funding and the balance of the project funding through a strategic stake sell down. Each of these milestones de-risks the path to production and should yield individual re-ratings.”

Ben Davies has a Fair Value based on conservative NPV assumptions of £1.06 per share and a HOLD recommendation based on a share price of 60 pence per share. He highlights that the Company continues to deliver on its key aims on offtake contracts, initial financing and commencement of construction. 

Despite forecasting a subdued uranium price outlook Davies demonstrates the project’s free cash flow of over US$150 million per year once in full production. 

In light of the Company’s announcement that the cost of the recently ordered crushers has come in at 20% lower than estimates he has calculated that a reduction of 10% in capital and operating cost would increase his valuation to £1.18 per share.

Following an oversubscribed equity funding from London’s blue institutions the Company has over US$30 million in cash and is accelerating the development of the Salamanca project.


 

     
     

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For further information please contact Katie Ryall on +44 (0)207 478 3900
or kryall@berkeleyenergia.com

Email: info@berkeleyenergia.com 
Web: www.berkeleyenergia.com
 
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Berkeley Energia · Unit 1B, Princes House · 38 Jermyn Street · London, SW1Y 6DN · United Kingdom