With nearly all sustainable energy technologies and a wide spectrum of defense applications dependent on certain mineral supplies, one penny stock traders may want to track the progress of U.S. Rare Earths, Inc. (OTC: UREE) during the course of the next few months. Filing heir 10-K yesterday and with drills already in the ground on their Diamond Creek property in Idaho, UREE stock is one exploration Company with a unique revenue model to help it along the way. While $4 million is what the Company has earmarked for their early stage development projects, the share price could become a guided missile over the course of the year and is worth monitoring.
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UREE Stock Quote
Market Cap: 49.73M
Last Trade: April 3
52Wk High: 3.74
52Wk Low: 0.11
Issued and Outstanding: 27,822,811
Insiders’ as a group: 20,206,429 (73.2%)
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The drill permits U.S. Rare earths applied for were approved in mid-October, 2012 and the Company’s plan of operation for drilling at their Diamond Creek, Idaho Project. Although only limited drilling has taken place for sampling, the plan of attack is for the development to ramp p on the Diamond Creek and North Fork Properties sites in Idaho during the course of this year. 2013 could be explosive for UREE stock, depending on the financing arrangements, since, on February 21, 2013, drilling permits were approved for their Sheep Creek property in Montana.
With a the structure that looks extremely attractive (a float of around 7.6 million), the truth of the matter is that U.S. Rare Earths could turn into a successful mineral exploration and development company over the course of the next few years.
The industry for rare earths elements has been mainly dominated by China for decades now. With a total of 17 elements: the 15 lanthanide elements (cerium, lanthanum, neodymium, praseodymium, promethium, which does not occur naturally, samarium, europium, gadolinium, terbium, dysprosium, holmium, erbium, thulium, ytterbium and lutetium), plus two elements with similar chemical properties to the lanthanides, yttrium and scandium, The Company’s deposits in Colorado, Idaho and Montana are known to contain such.
The intriguing factor which makes UREE stock appear attractive is twofold. Many already know how large suppliers of machinery, like Caterpillar Inc. (NYSE:CAT), are expecting lower forecasted sales since the industry expanded so rapidly over the previous 5 years. The other factor is that each and every industry dependent on rare earth elements is in a holding pattern stage which will eventually see another growth pattern putting U.S. Rare Earth’s in a perfect storm to begin their projects in 2013.
Industries dependent on rare earth elements which could force UREE stock to rise on speculation include an large number of both green-tech and high-tech applications, as well as advanced defense systems and space-based communications systems:
Green-tech applications include:
● Hybrid cars and electric vehicles
● Wind turbines
● Solar photovoltaics
● CFL light bulbs
High-tech applications include:
● Mobile phones and digital music players
● Computer hard disk drives
● Fiber optics
Defense and space applications include:
● Global positioning systems
● Radar and sonar
● Major sea, land and air-based weapons systems
As long as U.S. Rare Earths continues to keep their subsidiaries, Media Depot and Media Max, a national agency specializing in co-op advertising, running, the operating income produced will be far outweighed by the selling, general and administrative costs involved. As soon as they can commit to solely focus on their development of their 12,000+ acres of mining claims, perhaps the sale of their operating subsidiaries can eliminate UREE stock being over-exposed to financing making it that much more attractive.
About UREE Stock
U.S. Rare Earths, Inc. is a mineral exploration, mining and claims acquisition company holding over 12,000 acres of mining claims for rare-earth elements in Colorado, Idaho and Montana.
Last 5 Trading Sessions:
It could take monhs before seeing a solid enough return to call UREE a good penny stock to buy. However, with the structure, mineral claims, and foundations already established, UREE stock could be one of the best value picks for those willing to “sit and wait” like the long investors in STWA Inc. have been for the last year plus.
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