While technically a technology company, Silex is shaping up to be an important player in the uranium and silicon space, developing laser enrichment technology for both chemical elements. They are currently aiming to build a commercial-scale pilot plant in a joint venture with uranium giant Cameco that, if successful, would allow the western world to become self-sufficient. The company raised $120m at $4.05/sh last month which was a ~13% discount to the share price at the time, with the raise now ~15% underwater and while the raise was opportunistic given shares had nearly doubled in just 3 months, the raise and subsequent share price pressure has created an opportunity. Much of the selling came for technical reasons, with Silex (SLX) expected to be added to a number of key indices ahead of the raise, hedge funds had been buying stock expecting to sell into index-tracking funds at the time of the inclusion, but were left cornered in the institutional placement, exacerbating the selling since. We like the technology and the company’s outlook with a number of near-term catalysts and a supportive global partner in Cameco.
MM is bullish SLX, looking to add it to the Emerging Companies Portfolio
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