Centrus Energy Delivers Steady Revenue Growth: Is It Sustainable?

Core Insights - Centrus Energy (LEU) has achieved a compound annual growth rate (CAGR) of 14% in revenues from 2021 to 2024, with a notable 9% increase in 2023 and a significant 38% jump in 2024. The momentum continues into 2025, with a 67% year-over-year surge in total revenues to $73 million in Q1 [1][11]. Revenue Segments - The LEU segment, which includes revenues from sales of Separative Work Units (SWU), natural uranium hexafluoride, and uranium concentrates, remains the primary growth driver. In Q1 2025, LEU segment revenues increased by 117% to $51.3 million, driven by a 46% rise in SWU prices and a 49% increase in volumes [2][3][11]. - The Technical Solutions segment has also shown improvement, with revenues rising 8% year-over-year to $21.8 million in Q1 2025, primarily due to a $2 million increase from the HALEU Operation Contract. In 2024, this segment's revenues surged 80% to $92.1 million [4][5]. Backlog and Market Position - Centrus Energy has a revenue backlog of $3.8 billion, including long-term sales contracts with major utilities through 2040, with the LEU segment accounting for $2.8 billion of this backlog [6]. - The HALEU market is projected to grow from $0.26 billion in 2025 to $6.2 billion by 2035, and Centrus Energy holds a first-mover advantage as the only company licensed for HALEU enrichment [7]. Peer Comparison - In comparison, Cameco Corporation (CCJ) has delivered a CAGR of 24.8% in revenues from 2021 to 2024, with Q1 2025 revenues rising 17% year-over-year to CAD 789 million ($550 million). Cameco's uranium segment revenues grew by 10% [8][9]. - Energy Fuels (UUUU) reported a year-over-year revenue drop of 33.5% in Q1 2025 to $16.9 million, primarily due to the absence of uranium sales, despite a 106% increase in 2024 revenues [10][11]. Stock Performance and Valuation - Centrus Energy shares have increased by 225.1% year-to-date, significantly outperforming the industry average growth of 6.1% [13]. - The company is trading at a forward 12-month price/sales multiple of 8.21X, which is a substantial premium compared to the industry's 2.81X [14].