Cameco

Stock: CCJ

Rating: Good

Author: Waleed M. Tariq

Summary

  • Cameco is Canada’s second-largest uranium producer.
  • As the world seeks alternative energy sources, Russia-Ukraine pushes uranium demand.
  • Due to high profitability and operating cash flows, CCJ’s annual dividend policy just rose 50% to $0.12 per share.

Bullish

  • The pandemic has pushed uranium prices to 9-year highs.
  • Cameco is well-positioned to grow with its enormous uranium reserves.
  • Cameco’s expansion response to growing uranium price and demand has me bullish on the company.

Bearish

  • Due of its shaky results in 2021, CCJ appears weak.

Uranium prices

  • Uranium prices have risen due to growing demand.
Trading economics

World Uranium, Russia

  • Global gasoline imports rose 80.5%, while Russian imports rose 71.5%. The US sold $84.94 billion in gas and oil in 2021, 6 times more than Russia.
Forbes
  • By 2035, UxC anticipates 1.4 bn pounds of uranium will be needed. This will generate a global potential for Cameco.
IAEA

Cameco’s Demand

  • The company wants to reopen its McArthur River factory, adding 3.5 million pounds in 2022 and 15 million in 2024 in supply.
Cameco

Conclusion

  • I expect foreign governments to raise nuclear energy outputs, raising Cameco’s uranium demand.