Uranium Supply-Demand Dynamics Tighten, Goldman Sachs Expects Cameco To Benefit

Goldman Sachs analyst Brian Lee assumes coverage on Cameco Corporation CCJ with a Buy rating and price forecast of $65/C$89.

The analyst says that this positive outlook is primarily driven by three key elements, which include growing demand for nuclear energy, favorable pricing dynamics, and the unlocking of value through its Westinghouse subsidiary.

The analyst sees the company as the most strategically sound opportunity to capitalize on the nuclear theme.

The company is expected to benefit from structural tailwinds, driven by tightening supply-demand dynamics in the uranium market, adds the analyst.

Notably, CCJ’s assets account for 25% of global uranium production, and its share of overall production is projected to be around 14% globally through 2035, according to GSe.

Lee revised EPS estimates to C$1.21, C$2.13, and C$2.59, down from previous figures of C$1.66, C$2.42, and C$3.10.

This adjustment reflects increased costs and lower realized pricing, says the analyst.

For the Q5-Q8 period, the analyst estimates adjusted EBITDA for the Uranium, Fuel Services, and Westinghouse segments at C$1,278 million, C$247 million, and C$669 million, respectively.

Price Action: CCJ shares are up 2.27% at $52.34 at the last check on Tuesday.

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