quakes99 wrote: The question came up on comparing FCU vs NXE share price.
In order to compare the market valuations being assigned to 2 companies with different assets and number of outstanding shares, make yourself an Excel spreadsheet. This is what you would discover if you use the published NI 43-101 Resource sizes and issued shares.
| | Issued Shares | Current SP | Market Cap | Mlbs U3O8 | $/lb U3O8 |
| Fission FCU | 484,072,994 | $0.56 | $271,080,877 | 108.3 | $2.50 |
| NexGen NXE | 303,902,506 | $2.03 | $616,922,087 | 201.9 | $3.06 |
This is just using a simple comparison method that does not account for Fission having over $60Million cash on hand with no debt, or NexGen having a similar cash balance but a US$60M debt, or the fact that Fission has 75% Indicated, 25% Inferred U3O8 while NexGen is 100% the lower confidence Inferred resource category.
The upshot is that the promoters and hedge fund managers have been talking up NexGen to the point where it is being valued by the market at $3/lb of U3O8 in the ground... while Fission is valued at just $2.50 per lb at PLS. Part of the reason may also be that expectations are already there that Arrow is already over 300M lbs, so speculators are buying on that expectation for an updated Resource Estimate next summer/fall. That would reduce that $3/lb valuation down to only $2/lb, much less than PLS when you take that into consideration.
Traders are working the NXE stock right now, as evidenced by the NXE bullboard having been taken over by traders, while long term investors are the ones looking at Fission, eyeing long term upside rather than short term trading volatility, imho.
Anyway, it all comes down to potential upside when you are a long term investor not wanting to play the swing trade volatility. With NXE already trading at $2 with a $3.99 Bloomberg consensus target price, that puts the upside at less than 100% from here. For Fission, Bloomberg shows a $1.87 consensus price target, providing 234% upside from here.
As discussed earlier, buyers and sellers of Fission are not agressive right now while they wait for catalysts on the sidelines. NexGen is still a trader's game, providing profitability in the daily swing trade and speculative promotion.
Each to their own!
Good luck with your investments, however you play them. ;-)