UEC - Uranium Energy (UEC) stock has a 16% upside but beware of FOMO
2023-09-29 06:30:00 ET
Uranium Energy Corp (NYSE: UEC) stock price jumped to the highest level since April 2022 after the company published an encouraging annual report. The shares surged to a high of $5.72 in the premarket, ~150% above the lowest level in June. They have roared back by 1,543% from the 2020 lows.
Uranium stocks are surging
Uranium stocks have been in a strong bullish trend in the past few months, helped by the rising demand . The closely followed Sprott Uranium Miners ETF (URNM) has risen in the past seven straight weeks and is now hovering at the highest point on record. It has soared by 580% from its lowest point on record.
Similarly, the Sprott Physical Uranium Trust (SRUUF) rose to a record high of $18.24. This trend is mostly because of the rising uranium demand and the struggling supplies. The rally gained momentum recently after a coup in Niger , a major African producer. As a result, the price of uranium has jumped by over 30% this year to $62 a pound.
Therefore, the Uranium Energy Corp has soared because of this enthusiasm about nuclear energy. The rally accelerated after the company published its annual report for the fiscal year 2023. In its report, the firm said that its revenue jumped to $163.95 million while the gross profit rose to $49.6 million.
UEC has made important milestones
UEC has made several milestones recently For example, it was a key supplier to the Department of Energy, which established the Strategic Uranium Reserve. Further, the company acquired UEX Corp, a Canadian company, making ita major land owner in the Athabasca region. In a statement, the CEO said :
“In South Texas and Wyoming, we completed programs to accelerate the production-readied timeline that will enable a shorter lead-time to restart ISR production from our hub and spoke platforms.”
I believe that uranium will be an important resource during the energy transition. However, investors in Uranium Energy Corp and other related companies should be aware of the herd mentality that creates bubbles.
We have recently seen several bubbles in the clean energy burst. For example, I recently wrote about Brookfield Renewable and NextEra , two big companies in the clean energy sector. The two shares have plunged recently as returns in in the sector have been weaker than expected.
Uranium Energy Corp stock analysis
The weekly chart shows that the UEC stock price has been in a strong bullish trend in the past few months. It recently flipped the resistance at $4.71 into a support level. This was a notable level since it was the highest swing in June and August 2022. The stock remains above the 50-week and 100-week moving averages.
Therefore, the shares will likely continue soaring as buyers target the all-time high of $6.58, which is 16.72% above the current level.
The post Uranium Energy (UEC) stock has a 16% upside but beware of FOMO appeared first on Invezz.