- Cameco (CCJ -1%) is initiated with a Market Perform rating and $24 target price at FBR Capital, driven by CCJ's leading position in the nuclear energy industry, solid production growth profile, high-quality asset base and a strong long-term contracting book.
- FBR has a favorable longer-term outlook for the uranium industry, given the 71 nuclear reactors under construction, which alone reflect ~23% of the current annual demand.
- In the near term, however, the industry remains plagued by an oversupply situation, idled nuclear reactors in Japan reducing demand and building up utility stockpiles, all of which could keep pricing below economic return levels and lead to industry-wide production cuts.
- ETFs: NLR, NUCL
FBR starts Cameco at Market Perform amid favorable long-term outlook
Dec 11 2013, 14:59 ET