Cameco Is the Leading Play on Nuclear Power, And It Pays to Own

Core Viewpoint - Cameco is positioned as the leading provider of uranium, essential for the nuclear power industry, and has demonstrated significant financial performance with a 250% increase in share price over two years [1]. Group 1: Company Overview - Cameco's current stock price is $55.19, reflecting a gain of 2.60% [1]. - The company has a 52-week price range of $35.43 to $58.72, with a dividend yield of 0.14% and a P/E ratio of 128.35 [1]. - The price target for Cameco is set at $66.56, indicating potential upside [1]. Group 2: Business Fundamentals - The demand for nuclear fuel is increasing, supporting Cameco's business model, which includes ample reserves and positive cash flow [2]. - Cameco has 485 million pounds of U₃O₈ reserves, equating to approximately 16 years of sales at current production levels [3]. - The company has diversified its revenue streams through the acquisition of Westinghouse, enhancing growth opportunities [2]. Group 3: Market Dynamics - Uranium prices have been on the rise since 2017, driven by increasing demand, with projections for continued growth [4]. - Major tech companies like Amazon, Google, and Microsoft are investing in nuclear projects to power their data centers, which is expected to boost demand for uranium [5]. Group 4: Financial Performance and Outlook - The capital return is stable, with a payout ratio of 15% of earnings, and substantial earnings growth is anticipated in 2025 [6]. - Analysts project a 95.18% growth in earnings, with a consensus rating of "Buy" and a price target 25% above recent highs [7][8]. - Institutional ownership stands at 72%, contributing to a 28% price increase for the year [7]. Group 5: Technical Analysis - The stock price trend is upward, with strong support at approximately $52.50, indicating resilience against potential pullbacks [9].