CCJ

Cameco Corp

Industrial/Transportation


Presented:01/29/2019
Price:$12.33
Cap:$4.88B
Current Price:$51.71
Cap:$22.50B

Presented

Date01/29/2019
Price$12.33
Market Cap$4.88B
Ent Value$4.82B
P/E RatioN/A
Book Value$9.45
Div Yield0.49%
Shares O/S395.79M
Ave Daily Vol2,183,371
Short IntN/A

Current

Price$51.71
Market Cap$22.50B
Cameco Corp. engages in the provision of uranium. The company operates through three segments: Uranium, Fuel Services and NUKEM. The Uranium segment involves the exploration for, mining, milling, purchase and sale of uranium concentrate. The Fuel Services segment involves the refining, conversion and fabrication of uranium concentrate and the purchase and sale of conversion services. The NUKEM segment provides access to traders of uranium and uranium-related products. Cameco was founded in 1988 and is headquartered in Saskatoon, Canada.

Publicly traded companies mentioned herein: Cameco Corp (CCJ), NAC Kazatomprom JSC (KAP LI), Orano (private with public debt)

Highlights

Given the potential for the uranium cycle to finally turn, after a decade of declines and the down-cycle being exacerbated by the Fukushima disaster, the presenter is long shares of Cameco Corp (CCJ). With the stock trading in the $12 - $13 range, the risk/reward appears to be skewed to the upside. CCJ is the second largest producer of uranium in the world, and it has been treading water for years in anticipation of a rise in the U3O8 price (UXA1 on Bloomberg). The stock used to trade in the $40 - $50 range, and could be worth equally as much again if the cycle unfolds as the presenter expects. Following production cuts and a return of demand, all that really needs to happen to get the stock moving is: one utility sees the potential for a price spike and signs a long-term deal at an attractive price per pound (e.g., over $40/lb, up from ~$29).

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Idea Discussion

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