Cameco’s profitability is based on the higher costs of uranium relative to the minimums of the existing cycle.
COVID-19 halted Cameco production and added more uncertainty to the supply.
Demand for nuclear force and reactors has slowed in Western countries following the Fukushima disaster.
The bullish case of uranium expansion concerns a healthy Chinese economy.
Cameco Corporation (NYSE: CCJ) is well placed to take advantage of the value of emerging uranium. The manufacturer has some of the most productive production assets in the industry and extensive reserves shown. Low and sustained uranium values have forced Cameco to close several production sites in recent years. The company is following the Chinese call for the structure of the nuclear reactor to increase the value of uranium; however, there is significant uncertainty about the appearance of the source in the value equation. Cameco’s actions offer potential for improvement; However, the company can also be very volatile due to a higher global source and call for uncertainty.
Cameco is a purely uranium manufacturer founded in Saskatchewan, Canada. Founded in 1987, Cameco is one of the largest uranium manufacturers in the world and has some of the quality uranium reserves. Negotiated with the NYSE as “CCJ” and with the TSX as “CCO”, Cameco has a market capitalization of approximately C$5.5 billion. The company operated in two segments, Uranium and Fuel. The uranium business includes the exploration, production and marketing of uranium. The Fuel Services segment is committed to refining and generating uranium concentrate powder (yellow cake). Cameco accounts for about 9% of the world’s uranium production, making it the fourth largest manufacturer in the world.
Source: Statist