Financial Data and Key Metrics Changes - The company reported strong fourth quarter and annual results for 2024, with net earnings and adjusted net earnings reflecting a return to Tier-1 production levels, higher sales volumes, and improved average realized prices [10][29]. - The adjusted EBITDA from Westinghouse was noted as a better reflection of its strong underlying performance despite a full year net loss from Westinghouse due to purchase accounting [29]. Business Line Data and Key Metrics Changes - In the Uranium segment, the company delivered just under 34 million pounds of uranium in 2024, with production slightly exceeding expectations at approximately 23.4 million pounds, driven by strong performance from the McArthur River/Key Lake operation [30][32]. - The production at the McArthur River/Key Lake operation set a new annual production record, while production from Inkai was impacted by supply chain issues, resulting in a total of 7.8 million pounds, about 600,000 pounds lower than in 2023 [30][32]. Market Data and Key Metrics Changes - The long-term contracting volumes in 2024 remained below 120 million pounds, indicating a decline from previous years, but the company successfully negotiated off-market contracts, adding to its long-term portfolio [20][22]. - The company has commitments to deliver an average of about 28 million pounds of uranium over the next five years, with a total long-term book of business in the uranium segment now totaling approximately 220 million pounds [20][21]. Company Strategy and Development Direction - The company continues to focus on aligning production with its contract portfolio and market opportunities, emphasizing responsible supply management and operational efficiency [27][34]. - The strategic positioning in the nuclear sector is aimed at benefiting from expected growth while remaining protected against potential market fluctuations [26][27]. Management Comments on Operating Environment and Future Outlook - Management expressed optimism about the nuclear power outlook, citing supportive market conditions and geopolitical factors that enhance energy security and clean energy needs [12][13]. - The company anticipates strong cash flow generation in 2025, supported by a disciplined strategy and a strong balance sheet [35][36]. Other Important Information - The company is monitoring potential U.S. tariffs on Canadian energy products and has taken proactive steps to mitigate any potential impacts [38][39]. - Recent developments include the resolution of a technology and export dispute involving Westinghouse, which is expected to enhance future cooperation and opportunities [37]. Q&A Session Summary Question: Update on contracting activity and market conditions - Management noted that while term volumes were down year-over-year, term prices increased significantly, indicating a shift towards recognizing the need for future supply [45][46]. Question: Impact of production suspension at Inkai - Management confirmed a strong long-term relationship with Kazatomprom and indicated that discussions are ongoing to assess the impact of recent production suspensions [56][57]. Question: Update on AP1000 builds and Westinghouse cooperation - Management expressed excitement about the Westinghouse deal and the potential for future cooperation, particularly in the context of new builds in various countries [62][64]. Question: Potential impact of lifting sanctions on Russia - Management emphasized that the growth plan does not depend on sanctions and that the supply-demand fundamentals remain strong regardless of geopolitical changes [78][80]. Question: Clarification on tariff responsibilities in contracts - Management explained that new contracts include clauses that place tariff responsibilities on customers, mitigating potential financial impacts [93][110].

Core Viewpoint - Cameco Corporation (CCJ) is expected to report its fourth-quarter 2024 results on February 20, with earnings estimates showing a significant improvement compared to the previous year [1][2]. Financial Performance - The Zacks Consensus Estimate for CCJ's earnings is 23 cents per share, reflecting a 53% increase from the same quarter last year, with a 28% upward revision in estimates over the past 60 days [2]. - Revenue estimates for Cameco stand at $744 million, indicating a 20% growth from the prior year's quarter [3]. Earnings Surprise History - Cameco has missed the Zacks Consensus Estimate in each of the last four quarters, with an average negative earnings surprise of 66.60% [4][5]. Production and Sales Outlook - CCJ's expected uranium production share for 2024 is 23.1 million pounds, up from 17.6 million pounds in 2023, with a fourth-quarter target of 5.8 million pounds [8]. - The company plans to sell 32-34 million pounds of uranium in 2024, needing to sell 11.2-13.2 million pounds in Q4 to meet this target, an increase from 9.8 million pounds sold in Q4 2023 [9]. - Uranium spot prices averaged around $76.75 per pound in Q4, which is 7% lower year-over-year [9]. Operational Challenges - Cameco's Inkai mine is facing procurement and supply-chain issues, particularly with sulfuric acid deliveries, leading to a reduced production outlook [10]. - Annual UF6 production at Port Hope is projected to be between 11,000 and 11,500 tons for 2024, lower than previous expectations due to operational issues [11]. Fuel Services Segment - Fuel services production for 2024 is expected to be between 13.5-14.5 million kgU, with sales deliveries anticipated at 12-13 million kgU [12]. - Improvements in production and sales for fuel services are likely to positively influence CCJ's fourth-quarter performance [13]. Cost Management - The average unit cost of production at McArthur River/Key Lake is expected to be higher due to production ramp-up, while costs in the fuel services segment are also anticipated to be elevated [14]. - The company is making progress in reducing administration, exploration, and operating costs, which may help offset elevated costs on earnings [15]. Strategic Developments - In November 2023, CCJ acquired a 49% interest in Westinghouse Electric Company, with expected adjusted EBITDA contributions between $460 million and $530 million for 2024 [16]. Stock Performance - Shares of Cameco have increased by 11.9% over the past year, contrasting with an 8.6% decline in the industry [17].

Group 1 - The industry is expected to experience growth, with Cameco transitioning from a high-growth company to one with above-average but more mature growth over the next five years [1] - The uranium sector remains highly regulated, but increasing competition is anticipated over time, leading to a more stabilized mining industry benchmark for Cameco [1] Group 2 - Eric, who works at RBC Insurance on their investment team, holds a Master's degree in Financial Economics and has completed all three levels of the CFA program [1]

Industry Overview - Attitudes toward nuclear energy have fluctuated, particularly after the 2011 Fukushima disaster, leading to reduced investments and plans for new nuclear facilities [1][10] - Recently, there has been a resurgence of interest in nuclear energy as countries aim for net-zero emissions, positioning nuclear as a cleaner and reliable energy source [2] Cameco's Position - Cameco, one of the largest uranium producers globally, is strategically positioned to benefit from the renewed demand for uranium [3] - The company operates significant mining operations in Saskatchewan and the U.S., and holds a 40% interest in a joint venture with Kazatomprom in Kazakhstan [6] - Cameco produced an estimated 23.1 million pounds of uranium last year and has commitments for 29 million pounds per year through 2028 [7][13] Market Dynamics - The demand for nuclear energy is expected to increase, with initiatives like the Declaration to Triple Nuclear Energy aiming to triple nuclear capacity by 2050, supported by major financial institutions [5] - The U.S. Nuclear Regulatory Commission is exploring the possibility of bringing retired nuclear facilities back online, which could further boost demand [8] Financial Performance - Cameco's recent third-quarter earnings were disappointing, with a net loss and a high valuation at nearly 262 times its trailing-12-month earnings [11] - Despite the high valuation, forecasts suggest uranium prices could average around $110 per pound this year, driven by demand outpacing supply [12] Long-term Outlook - The International Atomic Energy Agency (IAEA) projects that nuclear capacity could increase by as much as 2.5 times by 2050, indicating strong long-term demand for nuclear energy [12] - Given the solid foundation and commitments from buyers, Cameco is viewed as a stock to hold for long-term benefits from shifting trends in the energy sector [13]

Group 1 - Cameco's stock closed at $49.85, reflecting a -1.01% change from the previous session, underperforming compared to the S&P 500's gain of 0.03% [1] - Over the past month, Cameco's shares have increased by 3.2%, which is lower than the Basic Materials sector's gain of 8.14% and the S&P 500's gain of 4.19% [1] Group 2 - The upcoming earnings report for Cameco is scheduled for February 20, 2025, with expected earnings of $0.23 per share, indicating a year-over-year growth of 53.33% [2] - Revenue is anticipated to be $735.56 million, reflecting an 18.64% increase from the same quarter last year [2] Group 3 - Recent changes to analyst estimates for Cameco are important as they reflect short-term business trends, with positive revisions indicating optimism about the company's outlook [3] - The Zacks Rank system, which incorporates estimate changes, provides a practical rating system for stocks [4] Group 4 - The Zacks Rank system ranges from 1 (Strong Buy) to 5 (Strong Sell), with 1 stocks averaging an annual return of +25% since 1988 [5] - Currently, Cameco holds a Zacks Rank of 3 (Hold), with a 3.51% decrease in the consensus EPS estimate over the last 30 days [5] Group 5 - Cameco's Forward P/E ratio is 39.84, which is significantly higher than the industry average Forward P/E of 12.65 [6] - The Mining - Miscellaneous industry, part of the Basic Materials sector, has a Zacks Industry Rank of 145, placing it in the bottom 43% of over 250 industries [6] Group 6 - The Zacks Industry Rank measures the strength of industry groups based on the average Zacks Rank of individual stocks, with top-rated industries outperforming the bottom half by a factor of 2 to 1 [7]

Group 1 - Cameco's stock closed at $50.36, reflecting a +0.86% increase, outperforming the S&P 500's gain of 0.67% [1] - Over the past month, Cameco's shares have increased by 1.4%, while the Basic Materials sector gained 6.91% and the S&P 500 gained 2.07% [1] Group 2 - Cameco is expected to release earnings on February 20, 2025, with projected earnings per share (EPS) of $0.23, indicating a 53.33% increase year-over-year [2] - Revenue is projected to be $735.56 million, reflecting an 18.64% rise from the same quarter last year [2] Group 3 - Recent modifications to analyst estimates for Cameco indicate a favorable outlook on the company's business health and profitability [3] - The Zacks Rank system, which includes estimate changes, has a history of outperforming, with 1 stocks returning an average annual gain of +25% since 1988 [4][5] Group 4 - Cameco is currently trading at a Forward P/E ratio of 39.5, significantly higher than the industry average of 12.11, indicating a premium valuation [6] - The Mining - Miscellaneous industry, part of the Basic Materials sector, holds a Zacks Industry Rank of 143, placing it in the bottom 44% of over 250 industries [6][7]

Company Performance - Cameco's stock closed at $49.44, down 1.71% from the previous trading day, underperforming the S&P 500's loss of 0.51% [1] - Over the last month, Cameco's shares decreased by 3.57%, while the Basic Materials sector gained 4.34% and the S&P 500 gained 2.87% [1] Upcoming Earnings - Cameco's earnings report is scheduled for February 20, 2025, with projected earnings per share (EPS) of $0.18, representing a 20% increase year-over-year [2] - Revenue is estimated to be $735.56 million, indicating an 18.64% increase compared to the same quarter last year [2] Analyst Estimates - Recent adjustments to analyst estimates for Cameco reflect changing business trends, with positive revisions indicating analyst optimism about the company's profitability [3] - The Zacks Consensus EPS estimate has decreased by 5.11% in the past month, and Cameco currently holds a Zacks Rank of 3 (Hold) [5] Valuation Metrics - Cameco's Forward P/E ratio is 39.79, which is significantly higher than the industry average Forward P/E of 11.26 [6] - The Mining - Miscellaneous industry, part of the Basic Materials sector, has a Zacks Industry Rank of 140, placing it in the bottom 45% of over 250 industries [6] Industry Insights - The Zacks Industry Rank measures the strength of industry groups based on the average Zacks Rank of individual stocks, with the top 50% outperforming the bottom half by a factor of 2 to 1 [7]

Group 1: Market Impact - The announcement of DeepSeek's AI development has led to a significant sell-off in uranium mining stocks, with Denison Mines down 9%, Uranium Energy down 10.1%, and Cameco down 13.2% [2] - Uranium prices were already in a downturn, having fallen 34% from a recent high of nearly $70 per pound to just under $70 [4] - The resumption of uranium production by Cameco's Inkai joint venture adds further supply to a market already facing declining prices [5][6] Group 2: Demand and Supply Dynamics - There are concerns that demand for nuclear power may not be as strong as previously anticipated, particularly in light of the new AI developments [5] - The long-term trend indicates a tug of war between uranium demand and increased production, which could keep prices in balance [9] - The break-even point for uranium mining is around $60 per pound, suggesting that current prices are still above this threshold, but profitability for companies like Denison and Uranium Energy has been declining [8][9] Group 3: Company Performance - Denison and Uranium Energy have reported losses for three consecutive quarters, while Cameco's profits have significantly decreased compared to the previous year [10] - Current valuations do not support a recommendation to buy these money-losing uranium stocks, including Cameco [10]

Investment Rating - The report does not explicitly mention the investment rating for Cameco Corporation [1][2][3] Core Views - The global nuclear power industry is expected to grow rapidly, driven by both the US and China, with the US focusing on nuclear power as a solution for AI energy demands and China accelerating nuclear power projects [7] - Uranium supply is a critical factor in the industry, with increasing demand for nuclear fuel expected to drive uranium prices higher [7] - The global nuclear power industry is gaining renewed attention, with 22 countries signing the "Triple Nuclear Energy Declaration" at COP28, aiming to triple global nuclear power capacity by 2050 [11] - Developing countries are leading the increase in global nuclear power capacity, with new nuclear projects in countries like Egypt, Turkey, and Bangladesh [11] - China's nuclear power capacity is relatively low, with significant growth potential as it aims to replace coal-fired power with cleaner energy sources, particularly nuclear power [12] - China has accelerated its nuclear power project approvals, with 11 new reactors approved in 2024, far exceeding previous expectations [15] - The US faces both challenges and opportunities in nuclear power, with aging infrastructure but also plans to increase nuclear capacity to meet net-zero emissions targets by 2050 [21] - Small modular reactors (SMRs) are expanding the application scenarios for nuclear power, increasing demand for nuclear fuel [23] - Tech giants like Microsoft and Amazon are investing in nuclear power to meet the energy demands of AI and data centers [27] - Data center power demand in the US is expected to grow significantly, with nuclear power being a key solution to meet this demand [30] Industry Overview - Global nuclear power capacity is expected to triple by 2050, driven by the "Triple Nuclear Energy Declaration" and increasing demand for clean energy [11] - Developing countries are leading the growth in nuclear power capacity, with new projects in countries like Egypt, Turkey, and Bangladesh [11] - China's nuclear power capacity is relatively low, with significant growth potential as it aims to replace coal-fired power with cleaner energy sources [12] - China has accelerated its nuclear power project approvals, with 11 new reactors approved in 2024, far exceeding previous expectations [15] - The US faces challenges with aging nuclear infrastructure but also opportunities with plans to increase nuclear capacity to meet net-zero emissions targets by 2050 [21] - Small modular reactors (SMRs) are expanding the application scenarios for nuclear power, increasing demand for nuclear fuel [23] - Tech giants like Microsoft and Amazon are investing in nuclear power to meet the energy demands of AI and data centers [27] - Data center power demand in the US is expected to grow significantly, with nuclear power being a key solution to meet this demand [30] Company Overview - Cameco Corporation is the world's largest uranium resource company, with operations spanning exploration, mining, refining, and nuclear fuel services [45] - The company has a significant presence in the global uranium market, with operations in Canada, Kazakhstan, and the US [45] - Cameco's uranium resource business is its primary revenue driver, with uranium prices significantly impacting its financial performance [52] - The company owns several high-grade uranium mines, including McArthur River/Key Lake and Cigar Lake, which are among the largest and highest-grade uranium mines in the world [60] - Cameco is also involved in nuclear fuel services, including uranium refining, conversion, and fuel manufacturing, with a global market share of around 21% in conversion capacity [66] - The company has expanded its presence in the nuclear power industry through strategic investments, including a 49% stake in Westinghouse Electric and a 49% stake in Global Laser Enrichment (GLE) [67][70] - Cameco's uranium resource business is expected to benefit from rising uranium prices and increasing global demand for nuclear fuel, with revenue projected to grow significantly from 2024 to 2026 [74] - The company's nuclear fuel services business is also expected to grow, driven by increasing demand for nuclear fuel and higher prices for uranium products [78] Valuation - Cameco is expected to see significant revenue and profit growth from 2024 to 2026, driven by rising uranium prices and increasing demand for nuclear fuel [81] - The company's revenue is projected to reach CAD 2.94 billion in 2024, CAD 3.36 billion in 2025, and CAD 3.74 billion in 2026, with net income expected to grow to CAD 370 million, CAD 670 million, and CAD 850 million respectively [81] - Cameco's strong position in the global uranium market, combined with its strategic investments in Westinghouse and GLE, is expected to drive long-term growth and solidify its leadership in the nuclear power industry [81]

Retirement Planning - The Retirement Forum offers actionable ideas, a high-yield safe retirement portfolio, and macroeconomic outlooks to help maximize capital and income [1] - The forum searches the entire market to help maximize returns [1] Cameco Corporation (CCJ) - Cameco Corporation is the largest publicly traded uranium company globally with a market cap exceeding $20 billion [2] - Nuclear power has substantial potential as reliable base load power [2] Investment Strategy - The Value Portfolio specializes in building retirement portfolios using a fact-based research strategy [2] - The strategy includes extensive readings of 10Ks, analyst commentary, market reports, and investor presentations [2] - The portfolio invests real money in the stocks it recommends [2]