Skip to Content
US Videos

Cameco Has More Room to Run

This narrow-moat, low-cost producer is well-positioned to benefit from a continued uranium turnaround.


David Wang: Uranium prices are beginning to recover after years of declines. After reaching a low of $18 per pound in December 2016, spot uranium prices have increased nearly 30% to $23 per pound. We see continued upside, as tightening market conditions should drive spot and contract prices to increase this year. 

Cameco shares have rallied in response to this market turnaround. Since reaching multiyear lows in November 2016, Cameco shares have nearly doubled in the past few months. Although it's had a good run, we still see roughly 40% upside for Cameco shares. Uranium prices still need to increase from current levels to incentivize sufficient production to meet strong demand growth from China's nuclear reactor build-out. 

As one of the largest and lowest cost producers, Cameco is especially well-positioned to benefit from a turnaround in uranium.

David Wang, CFA does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.