Casey Energy Opportunities says hold Magnum Uranium

2009-02-06 19:50 ET - In the News

Casey Energy Opportunities in its Jan. 12, 2008, issue, says hold Magnum Uranium Corp. (13 cents).

The newsletter said buy on Nov. 15, 2007, at 50 cents, and on July 8, 2008, at 49 cents. An investment of $1,000 for each of the two buys is worth $520. Casey's always-optimistic writer begins by noting the San Raphael district is one of the most prospective uranium areas in the southwest United States.

Also, Denison Mines Corp.'s White Mesa mill is nearby to process the uranium. Geography alone is not the secret to Magnum's future success.

He says the company has a significant amount of cash in the bank, enough for next year's exploration program.

It is also trading below cash value. All these are good reasons to at least hold onto the shares for now. However, he confesses he is nervous about buying more because the cost of uranium production in the region may be too high in the short run.

This means uranium properties will not be evaluated fairly. If Denison were forced to suspend the Tony M mine, it would mean the areas around it might be uneconomical. Still, the writer is sure that Magnum is the go-to explorer for uranium in the area.

If Denison reopens M, consider backing up the truck on Magnum.

Hg