Fission Uranium

01/14/2015 7:00 am EST

Focus: STOCKS

Nick Hodge

Founder and President, Outsider Club

My top speculative idea for the coming year is a company that has discovered the best uranium deposit of the last decade. Right now, it's considered the best unmined deposit of uranium in the world, asserts Nick Hodge, editor of Outsider Club.

The deposit, in the Athabaskan Basin, is called Patterson Lake South. The company that 100% owns it is Fission Uranium
(TSX: FCU) (OP: FCUUF).

The mineralization starts as shallow as 50 meters, meaning it can be low-cost pit-mined. And it's extremely high grade. Some assays have returned U308 mineralization as high as 40%.

An official resource estimate is due out in early 2015. I believe investors are anticipating 50-80 million pounds. Right now, Fission Uranium trades as a 50 million pound asset valued at ~$6.00 per pound. But that's simply too low.

Recent uranium deals in Athabasca have gone for an average of $10 per pound. And Patterson Lake South is better than any uranium assets that have been sold in recent memory, including Roughrider and Shea Creek. It's bigger, it's higher grade, and it's much more shallow.

Roughrider was purchased by Rio Tinto for $654 million. It had an NI-43101 resource of 58 million pounds starting at a depth 200 meters, meaning it sold for $11.28 per pound.

But check out what Cantor Fitzgerald has said about Fission Uranium's Patterson Lake South deposit: “We believe that the project has a good chance of exceeding 100Mlbs...and are starting to consider the possibility of 200Mlbs.”

A 200-million-pound deposit sold at $11.28 per pound would make Fission a $2.25 billion company. It currently trades with a $310 million market cap. With a resource estimate due out early in 2015, and a dormant uranium market starting to wake up, Fission Uranium is my top speculative pick.

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