TORONTO (ResourceInvestor.com) -- In August, we featured Bonaventure Enterprises Inc. [TSXv:BVT], which closed yesterday at 39.5 cents. At that time, the company’s shares were changing hands for nearly double the current price – or 74 cents.

As few as 6 days ago Bonaventure closed at 60 cents but as happens all too often with small venture listed companies, the investors who took part in a 20-cent financing earlier this year elected to blow out their stock in the week prior to and on the first day of (yesterday), their paper becoming free trading.

In one sense admittedly Bonaventure offered a triple from their entry point while every other uranium junior was falling (not to mention the half warrant), but it does seem silly to be coming off of BVT paper now, just as the company is readying to drill a mega-tonnage target.

What this selling also means is that readers who are not long are being given a window of opportunity to pick up artificially depressed paper courtesy of the 20-cent private placement subscribers.

Let’s review what we said in our last story, and highlight what has changed, and where we see Bonaventure moving forward.

The crux of the story in August was Bonaventure’s just completed acquisition of Four Lakes, including Foster Lake - a large property in the southeastern Athabasca Basin that surrounds JNR’s [TSXv:JNN] Way Lake discovery, which included samples yielding 40% and 48% uranium.

Bonaventure continues to hold this property which offers great leverage and optionality to JNR, and as we said in August, “Bonaventure looks strong because the right people are in the deal, and because the company is pursuing what in our minds is the best and really only model for explorers - look for elephants, offer high-impact optionality and garner a blue-sky premium.”

Since our last report the company has brought in a new President and CEO – Jean Lafleur- and a new property package has been acquired with the closing anticipated shortly (along with the current financing being completed, which will probably be re-priced) that has stolen the spotlight from the very interesting looking Four Lakes package.

The flagship in the group is the K9 property, and K9 offers company-making potential in a very short-time period. It has the potential to be a world-class deposit because the anomaly, as traced thus far, is huge.

K9

The 100%-owned 161.5 sq km K9 in the James Bay mining district of Quebec has all of the earmarks of a Rossing style deposit – potentially bigger based on surface anomalies.

The volumetrics at the property suggest a monster target if grades continue to depth (even just from surface down to 100 metres).

Here is the math:

• 7,000 metres long anomalous uranium corridor * 750 metres width * 100 metres depth * 2.7 specific gravity = 1,417,500,000 billion tonnes of rock.

• Bonaventure is collecting average surface grades of 3 pounds of uranium per tonne. This gives 1,417,500,000 billion tonnes * 3 lbs/t = 4,252,500,000 pounds of uranium.

• Now we cut the grade in 1/3 to reflect grades closer to Rossing style as the 3-D volumetrics of the deposit become known. This gives us 1 lb/t and 4,252,500,000 pounds / 3 = 1,417,500,000 pounds of uranium at K9.

This is a huge number and only works if mineralization continues down from surface. There is no reason geologically to believe that it does not. But to what extent? Over the whole distance? Or just part of the mineralized surface anomaly area?

If one risk-adjusts the number by 90% discounting for things like a grade half as high, uranium only down to 50 metres, and uranium over just a fraction of the total area, one gets 10% of 1.4 billion pounds of uranium, or roughly speaking about 140 million pounds of uranium at K9.

Were this to transpire, Bonaventure would be sitting on the biggest uranium resource of any listed junior in Canada to our knowledge – surpassing Aurora [TSX:AXU] with about 100 million pounds and a market capitalization of over C$1 billion.

So how does Bonaventure look from a valuation standpoint? And how long would it take to drill this up to the 43-101 compliant stage?

Valuation

When BVT completes its financing and property acquisitions it will have north of 100 million shares outstanding - by our math about 120 million shares. So at our 90% risk-adjusted number of 140 million pounds of uranium at K9, BVT would have 1.15 pounds of uranium for every outstanding share.

If K9 comes up with what it looks like it could have, Bonaventure’s closest comparable would be Aurora, which currently trades at roughly $10 of market capitalization per 43-101 lb of uranium in the ground.

This suggests a share price north of C$10 for BVT, not including any of the company’s other assets.

Timeline

Jean Lafleur, President and CEO of Bonaventure stated in a recent press release, "Importantly, we believe that the geological nature of our targets will allow the company to condense the time frame of proving up a potential NI 43-101-compliant resource.”

Digging into this we discover that because of the nature of the disseminated system of mineralization at K9, something on the order of 10–15 drill holes of about 100-150 metres each, angled properly, could be enough to report a compliant 43-101 inferred resource on K9 along the lines suggested in our math above, if the uranium is there.

What this means is that with Bonaventure planning to drill at the end of this month and through the winter, the company could have enough data by the end of Q1 to report a 100 million pound plus uranium resource at K9.

So if the company is right, investors will be rewarded with a big multi-bagger in the space of just months.

Conclusion

We think that Bonaventure has it right in the sense that exploration companies should focus on company-making projects which offer major blue-sky. Critical mass and district scale land positions are the keys.

At 39 cents, given these properties and the others already in the Bonaventure portfolio, and with the uranium speculative cycle hopefully beginning anew as prices start to tick up again towards $100/lb, BVT in our opinion is an excellent speculation in terms of risk/reward for those who have the risk tolerance and appetite for such plays.

If they get it right, even at our 90% risked number (this math is all hypothetical until they release the grade numbers identified by the drill bit), Bonaventure could be a nearly 30 bagger from present levels. If they miss, and move to other projects, maybe the risk is 50%. To us, that is a great exploration shot and a worthy and worthwhile speculation to get the blood pumping - Bonaventure could be the hot name on everybody’s lips given this optionality, and if they get a whiff at K9.