CMR 0.00% 15.0¢ compass resources limited

comment by huntleys

  1. 934 Posts.
    Compass Resources (CMR) – We maintain our Buy
    recommendation on this undervalued company. A recent
    sell-down by JV partner, Hunan Nonferrous, of half its 12m
    share stake in CMR spooked the market but has provided a
    buying opportunity. CMR is focused on development of its
    Browns project near Batchelor NT. First production from the
    base metal Oxides project is set for October. Exploration
    has restarted post end of the NT wet season. The record
    2007 field season is a 50% increase on the 2006 effort and
    includes 35,000m of drilling. Our upgraded $7.40ps valuation
    is marginally higher thanks to higher near term commodity
    price forecasts. Plans to split the company into three via an
    in-specie distribution to shareholders could liberate additional
    value, particularly via the spin-out of uranium interests.
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