National BankYou're welcome chuck. GLTA National Bank Financial analyst Mohamed Sidib sees uranium as the “place to be” for investors in the critical minerals space, expecting a “positive trend to continue to support equities in 2025.”
“As we look into 2025, we continue to forecast a deficit in total demand vs. primary production in 2025 given the continuous sulfuric acid shortage impacting supply out of Kazakhstan, the main source of growth over the coming years,” he said. “Positive trends on the demand front are likely to continue with new reactor constructions, reactor restarts, reassessment of nuclear energy policies by various government and the involvement of large cap technology companies. While spot market activity was muted in 2024, we note that the spot market could benefit from purchases by struggling producers impacted by slower-than-expected ramp ups or operational issues, as well as the potential return of financial players. As it relates to the term market, all we note is that it is only a matter of time before utilities have to come back to replenish the uranium required to keep these reactors running, so we are not too concerned by a return to replacement rate taking longer than expected. A limited supply growth and continued favorable outlook for demand are all beneficial for uranium equities which, in our books, still present some opportunities despite the easy money having been made.”
In a research report released Tuesday, Mr. Sidib warned “easy money has been made,” however he is predicting another strong year of share price performance from his uranium coverage supported by “uranium prices, geopolitical tensions and the involvement of large cap technology companies.” Denison Mines Corp. (“outperform” rating and $4.30) remains our top pick.
Mr. Sidib made a trio of target price adjustments to stocks in his coverage universe.
- Denison Mines Corp. ( “outperform”) to $4.30 from $4.15. The average is $4.09.
- American Lithium Corp. (“outperform”) to 80 cents from $1.50. Average: $4.33.
- NexGen Energy Ltd. ( “outperform”) to $13.50 from $13. Average: $14.05.
“Despite the positive sentiment in the space and while the easy money in the sector has likely been made, we argue that there remains opportunities to generate positive returns through stocks within our coverage universe,” he said. “Notably, DML and NXE continue to trade at an overall discount to current uranium spot prices based on our model and DML overall is trading at a lower valuation than the entire comped developer group. In 2025, media attention over the space is likely to continue, further garnering more support and enthusiasm from the public, specifically as AI investors look to play the data centers angle through other vehicles.”