Can Cameco Maintain Momentum Despite McArthur River Issues?

Core Insights - Cameco Corporation (CCJ) has set a uranium revenue target of CAD 2.8-3.0 billion for 2025, indicating an 8% year-over-year growth at the midpoint, based on uranium sales of 32-34 million pounds at an average price of $87 per pound [1][11] Production and Sales - In the first nine months of 2025, Cameco delivered 21.8 million pounds of uranium, generating revenues of CAD 1.847 billion at an average price of CAD 84.79 per pound ($60.39 per pound) [2] - Cameco's attributable uranium production from its McArthur River and Cigar Lake mines totaled 15 million pounds in the first nine months of 2025, reflecting a 13% decrease year-over-year, with McArthur River output down 32% and Cigar Lake up 16% [3][11] - Production delays at McArthur River due to transitioning into new mining areas have impacted output, leading to a shutdown of the Key Lake mill from September 3 to October 17, affecting production in Q3 and the first nine months of 2025 [4] Future Production Expectations - Cameco anticipates its share of uranium production from Cigar Lake to be 9.8 million pounds and from McArthur River to be between 9.8-10.5 million pounds, totaling up to 20 million pounds, with expectations to exceed this target by up to 1 million pounds [5] - The company plans to make market purchases of up to 1 million pounds and has committed purchases (including Inkai) of 9 million pounds, with an inventory of 10 million pounds at the end of Q3 [6] Industry Comparison - Among peers, Energy Fuels sold 150,000 pounds of uranium on the spot market in the first nine months of 2025 at an average price of $76.67 per pound, and 140,000 pounds under long-term contracts at $69.43 per pound [7] - Uranium Energy sold 810,000 pounds of uranium at an average price of around $82.52 per pound in fiscal 2025, with an inventory of 1.36 million pounds valued at $96.6 million [8][9] Stock Performance and Valuation - Cameco shares have increased by 67.8% this year, outperforming the industry growth of 21.6% [10] - The Zacks Consensus Estimate indicates a year-over-year earnings growth of 104% for fiscal 2025 and 38% for 2026, although estimates have been revised down over the past 60 days [12] - CCJ is currently trading at a forward price-to-sales ratio of 15.03, significantly higher than the industry's 1.42 [13]