TSX:CCO - Post Discussion
Post by
retiredcf on Feb 08, 2024 10:23am
RBC
February 8, 2024
Cameco Corporation
Q4/23 and 2024 guidance in line with expectations
TSX: CCO | CAD 64.65 | Outperform | Price Target CAD 70.00
Sentiment: Positive
Actual: $0.21 EPS | RBC $0.26 | Consensus: $0.22
We view Q4/23 and 2024 guidance as in line with consensus expectations, although we expect a positive stock reaction with uranium production set to return to nameplate, allaying buyside concerns into the quarter on potential operational issues. We also think the long-term Westinghouse CAGR guidance at 6-10% will be well received, as it confirms our expectations for growth above the previous guidance of at 3.6%.
Uranium sales were higher than we forecast (9.8Mlbs actual vs. 9.5Mlbs RBCe) and realized sales prices were also slightly higher (US$52/lb actual vs. US$51/lb RBCe) while costs were above our forecasts (C$57/lb actual vs. C$49/lb RBCe) due to higher purchasing costs. Uranium production in was about in line with our expectations (5.7Mlbs actual vs. 6.0Mlbs RBCe). Fuel service sales volumes were higher than expected (4.2M kgU actual vs. 3.6M kgU RBCe) while prices were slightly lower (C$32/ kgU actual vs. C$36
The company will also begin the work necessary to extend the Cigar Lake mine life to 2036 and evaluate the work required to expand McArthur River production to 25Mlbs (100% basis)
Cameco also provided guidance for 2024 and Westinghouse long-term growth, which we view as in line with our expectations.
• Uranium production of 22.4Mlbs U3O8 vs. RBCe 22.6Mlbs U3O8.
• Uranium sales of 32-34Mlbs U3O8 vs. RBCe 31Mlbs U3O8.
• Westinghouse 2024 attributable EBITDA at $445-510M, vs. RBCe $501M.
• Westinghouse five-year CAGR at 6-10%, with 4-6% core CAGR (5% RBCe) and contributions from nuclear new build activities.
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