PEN 3.57% 29.0¢ peninsula energy limited

Wake up penners

  1. 606 Posts.
    For those who couldn't see right through my 2nd last post I did it because I was at a stage where I felt the threat of oversubscription was high. Who am I to encourage others to bid for my stock? Sorry.

    I bid for $1m and all things going well in my favour...I hope I will get it. I don't mind declaring it now because I see at this late stage as being a case of "whats done is done." I've either got my allocation now or I don't. To those that rationalised that they thought it prudent NOT to sell current heads and buy RI stock (or extend themselves and buy more)...I understand that also. I just played out the leverage scenarios of 2m, 5m and 10m PENOD's at what I see as plausible numbers for pen into the future of say 6c (soon), 10c (not soon) and 15c (even longer). But as a strategy for longs, I believe it makes sense. Even if one was to sell the heads (which I won't be doing) and buy the '18 options, they can bank the difference and, if they believe in the U thesis...enjoy a very cheap bet on U in one of the best and (as I see it) de risked vehicle in PEN.

    IMO...the free PENOD is actually a gift from management/hq and fellow large shareholders such as PALA et al - for your loyalty and faith (bad word?). While the lead up to this point has been painful, I believe that this RI opportunity will be viewed as exactly that (an opportunity).

    I feel that the od's are probably fairly priced on a black scholes pricing method...but with downside risk protected (cash in bank, upside more likely ahead than downside), newsflow primed...the PENOD's will IMO be a windfall to all those that participated. Not to mention, they offer you a chance to liquidate (choice, leverage and liquidity) OR fend off further dilution (at a discount) if you are seriously worried about this (dilution in 2018) as a long termer. Getting a free 25m options made sense to me right now. In the mad panic that I believe is imminent to buy these options (and the underlying heads), the (seeming) value proposition of .003c (black Scholes) doesn't seem rational to what the market (I feel) should show up as close to 0.09c/1c almost immediately (as the news flow starts to price accordingly) not to mention the time value some uranium bulls might allocate to this product because of the 2018 exercise date. (yes, I might do some exercise before that date ) To me, to ignore a penod at almost 1c value to me (as I can't buy 25m on market without ratcheting price) for a 2c head price, was crazy.

    To give me the confidence in making this investment, I met in person with Ralph Knode, CEO of Strata Energy. Meeting Ralph and David (Coyne) demonstrated to me, the confidence of a team that are ready for what lies ahead. These guys are on, and calls of thinking these guys are part timers collecting big money is just wrong. I am not just defending them, they satisfy one of my primary 'mandatories' for my investments...they are good people working hard for their end goals. When their end goals meet mine...I'll back that horse.

    I can't remember talking to gus last year the better side of midnight, such was his schedule for PEN, not the bar or pool lounge as one would have thought if they had been reading these threads. Give the guy a call if you have a concern, don't check on here waiting for his silence to vindicate that he might be gallivanting on your dime.

    Before others ask... NO, no market sensitive information disseminated (if you're playing that have the wrong company!!) Between getting my pointers from rumours and innuendo off hotcopper and ringing HQ and asking...I'll take the latter. Meeting Gus is imperative for those who actually have concerns with their investments. I don't always get the answer I want, but I get a response.

    My brief predictions (and they are only predictions):

    - based on the premise hq have known about this finance package for months, i reckon any good news would have been banked and not disseminated in 2014 (when it would have been ignored or sold into) I can't say for sure, it's just what I would do in Gus' shoes. (I have dedicated my recent efforts to coming up with what I see being as plausible and planned news flow in 2015. Look at the analysts report is where some tidbits lie AND in the prospectus.) Fluffy seems on the right page here too. With the list that I have calculated, this not only sees opportunity, but also risk for traders of jumping out too early. I'll leave that dilemma with them. My tip. Watch news flow and cross them off your list. My list is huge. If they hit 50% of the list, we'll be flying.

    - as far as I can see, ALL pointers seem to suggest that PEN see themselves at $350-$400m. Now, whether you are there or not (or believe it) is sometimes irrelevant. Important is the 'powers that be' want it there. Whoever it was frogga/cropper/arsenic ?? ( I can't remember sorry guys) that suggested "first mover advantage"...that was a brain wave. The 'powers that be' would be aware of the impending uranium bull and that is irrespective of whether this is in 15/16/17 or 18. But like we all are aware in resources (and general equities). For fear of other peers being considered the 'market darling' over them, if I were them, I'd want to leapfrog my competition even the slight chance that the U bull hits us sooner rather than later. That way, takeover BS is off the table and our true place at the top of the heap should then leave us able to be 'indexed' with the rest of the bunch by then (whenever then is) worst. I am not factoring outperformance past this point, but I see chances of it more likely than not that we will outperform with our production/up ramp/karoo/high margin status.

    - I can't reiterate this enough but everything we have experienced with pen (at a stock, bid:sell level) needs to be forgotten. PALA will not be a seller imo in 2015 and while I understand the "I'll see it when I believe it" mantra, it's not a rational deduction if your being unemotional about this investment. (Hard to do I know...but imperative) As a small tangent, ask yourself where we could have got in 2014 if PALA didn't sell? It would have set highs north of 4c, is my guess. This is the psychological part of the play. Trust it or not, but I dare say those now holding will enjoy. We will see.

    - furthermore, while its not bogus to reference our billions of shares, this, for me is a minor issue to be dealt with by consolidation WHEN we are likely to be less impacted. Instead, think of the free float of shares that are no longer available IF the big parties (which I see as holding almost 70% of stock on issue) are true holders like I expect, at least for the short/medium term. Are there more shares for sale or or less? We can only see. I'd also argue that this experience has taken many shares from weak hands into strong ones. Strong hands don't (logically buy at 2c and sell at 2.4c)

    If at all, I hope this gets through to just a few of you, who up to now keep watching the distractions and guesswork that this site encourages. I am not dissing this thread at all (heck I'm here, the idiot that I am)...but at least I'm honest about it and I'm ramping the hell out of this thing.

    Because I want to? Yes.
    Because I will make money from it? Yes


    Because I believe it to be true. Absolutely yes.

    I just put $1m on it.

    Good luck penners!


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