Alkane Resources - Dubbo very robust

Thursday, Jan 26 2012 by
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Jan 26th 2012 - Edison Investment Research today published a report on Alkane Resources entitled "Dubbo Very Robust". In summary, the report says:

Media attention concerning the rare earth group of elements has dragged negative sentiment towards Alkane’s flagship Dubbo Zirconia Project (DZP). Indeed, prices for the DZP basket of goods (Zr, Nb, LREE and HREE based concentrates) decreased in Q411 (resulting in a 40% and 22% decrease in LREE and HREE Dubbo concentrate prices respectively between Q311 and Q411). However, our base case valuation (A$3.02/share excluding McPhillamys value of A$0.42) is based on significantly more conservative price estimates (indicative of those seen in Q111), and, maybe surprisingly, if we apply the ‘depressed’ rare earth prices seen in Q411, our base case increases by 129% to A$7.05/share.




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