CCJ - Cameco: A Bullish Trend Set To Continue Despite Q1 Earnings
2024-05-01 13:15:07 ET
Summary
- Uranium prices have been trending higher since 2020, with spot prices reaching over $100 in early 2024.
- Geopolitical factors and green energy initiatives support higher uranium prices, potentially leading to a shortage in the market.
- Cameco Corporation, a leading Canadian uranium producer, has shown a bullish trend and is likely to benefit from the increasing uranium prices.
In a March 4, 2024, Seeking Alpha article on the uranium market, comparing Ur-Energy to Cameco Corporation (CCJ), I wrote:
Cameco: A Bullish Trend Set To Continue Despite Q1 Earnings
CCJ was trading at just below $41.50 per share on March 4, while URG was at the $1.62 level. URG’s leverage in a market where uranium remains a hot commodity could mean there's more upside potential on a percentage basis in URG than CCJ shares over the coming weeks and months.
Leverage is a double-edged sword as it means that any downside price action in uranium could cause URG to fall further on a percentage basis than CCJ. However, since the trend is always your best friend until it bends, I favor URG’s upside potential in the current environment.