Trent Bar­nett Hart­leys

The Sunday Times - - BUSINESS -

SPEC BUY Pal­adin En­ergy (PDN) $0.21 We es­ti­mate ura­nium prices will need to re­cover to at least $US50/lb over the next two to four years to al­low global sup­ply to meet de­mand. PDN of­fers the most liq­uid play on ura­nium prices listed on the ASX and with no con­tracts in place of­fers 100 per cent ex­po­sure to a fur­ther re­cov­ery in prices. With two de­vel­oped as­sets now in care and main­te­nance, PDN is in a strong po­si­tion to se­cure the con­tracts re­quired to un­der­pin the restart of one or both of its mines, but a fur­ther re­cov­ery in ura­nium prices is cru­cial. BUY Ly­copodium (LYL) $4.60 We have re­cently com­menced coverage of LYL, a well-man­aged provider of en­gi­neer­ing and project man­age­ment con­sul­tancy ser­vices to a range of in­dus­tries, pri­mar­ily fo­cused on re­source pro­jects in Aus­tralia and over­seas. With a solid out­look, par­tic­u­larly for the gold sec­tor in WA and Africa, we be­lieve LYL is well placed to con­tinue de­liv­ery of earn­ings growth over the next few years. LYL has a strong bal­ance sheet (about $73 mil­lion net cash) and has con­sis­tently paid a strong div­i­dend, equiv­a­lent to about 65 per cent of earn­ings.

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