Investors Should Be Aware Of Cameco's Dispute With The Taxman
- The Canada Revenue Agency is speeding up the frequency of reassessments of Cameco's tax returns in what may be an attempt to pressure Cameco to settle out of court.
- Cameco's cash is being tied up as they are required to remit 50% of each disputed bill.
- Cameco could ultimately be on the hook for over $1 billion in taxes and penalties.
Update: Cameco Earnings - Strong EPS, But It's Mainly A Japanese Story Right Now
- Cameco reports strong Q2 earnings ($0.20 EPS vs. $0.18 expected). The lowered production target is not a major surprise following the Cigar Lake delay.
- As highlighted in our June 11 article, its low-cost model enables Cameco to weather a tough uranium price environment.
- We continue to believe that Cameco's business model strength suggests the group is in an ideal position to benefit from the expected uranium demand and pricing recovery.
- We reiterate our positive view on the stock following the recent Japanese developments that point to an accelerating nuclear restart program.
- Newsflow from Japan is finally improving: two Kyushu Electric reactors got the NRA safety clearance and could restart in coming months.
- Strong appetite for Japanese Utilities’ bonds suggests a pretty high confidence in the restart of reactors… at least from Japanese investors, who know Japan politics better than us.
- Another key positive is that the Japanese government is making the necessary moves to speed up the inspection and restart process of nuclear reactors.
- The pro-nuclear Tanaka will soon join the five-member panel of the NRA, in replacement of the hawkish Shimazaki.
- The gradual restart of reactors will be positive for sentiment and send uranium names such as Cameco higher.
- The nuclear restart process in Japan is taking longer than expected, putting pressure on the price of uranium.
- Notably, a Fukui prefecture court ordered a Japanese utility not to restart two idled nuclear reactors.
- This is a bump in the road: the precedents set by the Osaka Court of Appeal suggest that this ruling may not remain in force for long.
- We believe that sentiment could improve soon, when Japan gives the go-ahead to several of its reactors, while the long-term supply-demand dynamics are highly attractive.
- Cameco could take the opportunity of a low price environment to buy assets at low valuations.
Uranium Demand Uncertain: Is Cameco Corp. The Right Long-Term Play?
- The decrease in the annual uranium supply caused by the end of the HEU agreement will be offset by countries like Japan and Germany no longer using their nuclear reactors.
- Public distrust will likely keep most of Japans nuclear reactors off for the foreseeable future.
- New reactors under construction will provide little demand for Uranium in the near to midterm because of the time required to build these reactors.
- However, companies like Cameco Corporation (CCJ) are positioned to withstand the uncertainty in the near-term and reap the gains of a long-term recovery in the uranium market.
Fri, Sep. 12, 2:21 PM| Comment!
Thu, Aug. 28, 5:41 PM
- Uranium prices jumped the most in at least two and a half years after Cameco (NYSE:CCJ) moved to temporarily shut its McArthur River mine amid a labor dispute.
- McArthur River has the capacity to produce 18M lbs/year of uranium, or ~10% of global demand, according to Bank of Montreal analysts, and was the world’s largest uranium mine by production last year.
- Uranium prices are still only about half their levels just before the March 2011 earthquake and tsunami that led to the meltdown of three Japanese reactors and the suspension of the country’s nuclear power plants.
- ETFs: URA, NLR, NUCL
Wed, Aug. 27, 11:39 AM
- Cameco (CCJ -2.3%) says it has started shutting down operations at its McArthur River uranium mine and Key Lake mill in Saskatchewan after the union representing workers at those operations issued a strike notice.
- The United Steelworkers union advised CCJ of its intention to begin strike action on Aug. 30, and CCJ says it then issued a lockout notice to ensure a safe and orderly shutdown of its facilities.
- CCJ does not expect any labor disruption to its 2014 uranium delivery commitments, but says it may draw on a variety of supply sources including primary production, and existing purchase commitments and inventories.
Thu, Aug. 21, 1:58 PM
- Cameco (CCJ -4.9%) slumps nearly 5% after Cowen analysts downgrade the stock to Market Perform from Outperform with a $20 price target, lowered from $25, as the firm anticipates an extended malaise in uranium pricing.
- Cowen reassesses its uranium market outlook and expect that a meaningful recovery in pricing will not surface until 2017; despite strong long-term fundamentals, expectation for a recovery is more distant as a result of Japan's painfully slow restart process and ample global supply.
Thu, Jul. 31, 8:35 AM
Wed, Jul. 30, 5:30 PM
- AAWW, ABMD, ACIW, ACOR, ADP, AGI, ALKS, ALU, AMRC, APA, ASEI, ATK, AVP, AYR, AZN, BDX, BG, BGCP, BKCC, BLL, BUD, BWA, BZH, CCJ, CDW, CEVA, CHTR, CI, CL, CME, CNSL, COMM, COP, COT, CRCM, CRR, CTCM, CVI, CVRR, DDD, DISCA, DLPH, DTV, ENDP, EPD, EXC, FCH, FCN, FIG, FLY, FRM, GEL, GG, GIL, GLOP, GMT, GNRC, GTLS, H, HGG, HL, HP, HST, IDA, IMN, INCY, IRDM, IRM, ITT, IVZ, K, KMT, LKQ, LLL, LM, MA, MCK, MD, MDP, MNTA, MOD, MOS, MPC, MPLX, MSCI, MTOR, MWIV, NGD, NI, NJR, NWL, OAK, OCN, ODFL, OXY, PCG, PCRX, PES, PNR, PNW, PPL, PRFT, PWR, Q, RFP, RYL, SBH, SC, SCG, SFY, SHOO, SNAK, SNMX, STC, STRA, STRZA, SUP, SWC, TE, TEVA, TKR, TRP, TWC, UAN, UPL, USAK, VG, VICL, VNTV, VRX, WLT, WWE, XEL, XOM, XRAY
Wed, Jul. 16, 11:52 AM
- Uranium miner Cameco (CCJ +1.7%) is higher despite reporting that ore from its Cigar Lake mine in Saskatchewan would not be milled until early 2015 instead of before the end of 2014, due to problems freezing the ground.
- CCJ freezes the mine's ore zone and surrounding ground to prevent water from flooding production areas, but it says freezing has not advanced as quickly as expected.
- Uranium/nuclear names are broadly higher after two of Japan's nuclear reactors received clearance to re-start: USU +8.2%, DNN +3.3%, URG +3.2%, URRE +1.6%, BWC +1%, URS +0.3%, LTBR flat.
Wed, Jul. 16, 8:35 AM
- Japan's nuclear watchdog gives safety clearance for the restarting of two nuclear reactors in southern Japan, recognizing their compliance with stricter regulations created after the 2011 Fukushima nuclear accident.
- The move is seen as unlikely to lower prices for liquefied natural gas because the country’s 46 other units are unlikely to resume this year; North Asia LNG prices have rallied 54% since Japan shut nuclear plants and boosted gas purchases for power generation after the Fukushima disaster.
- Related nuclear tickers: NLR, CCJ, URA, BWC, SHAW, URS, FLR, LTBR, URG, UEC, URRE, USU, DNN
Thu, Jun. 5, 10:54 AM
- RBC cuts its outlook for uranium prices over the next several years as it concludes the market will remain in surplus through 2020.
- RBC believes Japanese reactor restarts could result in a recovery in uranium prices to $40/lb. in late 2014 or early 2015, but thinks the price is likely to be capped at that level until the market begins to tighten; the firm predicts only four Japanese reactors will restart this year with 28 - slightly more than half the current fleet - eventually restarting.
- Spot prices recently dropped below $30 as supply remains well ahead of demand since the Fukushima disaster.
- RBC cuts its price target for industry leader Cameco (CCJ -2.5%), seeing shares rangebound between $18-$27.
- URZ -3.3%, UUUU -2.5%, URRE -1.5%, UEC -1.1%, USU -0.9%, DNN flat, URG flat.
- ETFs: URA, NLR, NUCL.
Fri, May. 16, 5:30 PM
- Uranium prices have dropped to eight-year lows, with delays in restarting Japan's nuclear reactors prolonging a uranium supply glut, Bloomberg reports.
- Uranium dropped to $29/lb. on May 2, the lowest since June 2005 and extending this year’s drop to 16%; UBS has reduced its 2014 price forecast by 9% to $39/lb., and Credit Suisse cut its projection by 7% to $38.80.
- Japanese restarts are the key catalyst to get utilities to resume long-term contracting, which should support prices, Raymond James analyst David Sadowski says, cutting his 2014 price forecast by 14% to $36.
- "The next 18 months we see as being a very difficult period for the market," Cameco CEO Tim Gitzel says in the report.
- ETFs: URA, NLR, NUCL.
- Companies: CCJ, DNN, USU, URRE, UEC, URG.
Tue, Apr. 29, 8:35 AM
Mon, Apr. 28, 5:30 PM
- ABB, AGCO, AIXG, ALR, AMG, ARRY, AXE, BMY, BP, BSX, CARB, CCJ, CHKP, CIT, CMI, CNX, COH, CPLA, CRY, DBD, DDD, DORM, ESV, ETN, FDP, FLWS, FRX, GAS, GEO, GLT, GT, GTLS, HCA, HCBK, HRS, HUN, HW, IPGP, IRWD, KLIC, LG, LKQ, LRN, LYB, MGI, MGLN, MGM, MHFI, MLM, MRK, NMM, NOK, OSK, PCAR, PES, PH, POR, RESI, ROK, RTRX, RYN, S, SAVE, SCOR, SLAB, ST, TRW, UBSI, UDR, UTHR, VAC, VLO, WAT, WDR, WRLD, WWW, XYL.
Fri, Apr. 11, 4:53 AM
- Japan's Cabinet has approved an unpopular plan to reinstate nuclear energy as an important source of electricity, although there are doubts about how big a role atomic power will be able to play.
- Japan may have to leave up to two-thirds of its 48 idled nuclear reactors closed, a Reuters analysis shows, due to the high cost of upgrades, local opposition or seismic risks.
- The country's nuclear plants were shut following the Fukushima disaster over three years ago, which has caused the country to significantly increase its energy imports. That has acted as a drag on GDP and prompted fears that Japan could suffer from a permanent current-account surplus which could undermine confidence in its massive debt.
- Relevant tickers: DNN, CCJ, USU, URRE, UEC, URG
- Japan ETFs: DXJ, EWJ, FXY, YCS, JGBS, JGBD, JYN, NKY, DBJP, EZJ, EWV, YCL, ITF, JPNL, JGBL, JPP, JGBT, JPNS, HEWJ, JGBB, FJP, URA
- Nuclear ETFs: URA, NLR, NUCL
Sat, Apr. 5, 8:25 AM
- Bloomberg discusses the chances of the next nuclear accident, arguing it is a crisis waiting to happen and could be in a country with little experience to deal with it.
- While atomic power has fallen from favor in some western European countries since the Fukushima accident in Japan - Germany, for example, is shutting all its nuclear plants - it’s gaining more traction in Asia as an alternative to coal; of the 176 reactors planned worldwide, 86 are in nations that had no nuclear plants 20 years ago.
- If nuclear is to remain a part of the world’s energy supply, the industry must come up with solutions to make sure contamination - and other consequences, including financial - don't spread beyond station grounds, former NRC boss Gregory Jaczko says.
- Gregor Macdonald believes nuclear has no future, adding the extinction level event bearing down on global nuclear power is the rise of solar.
- Nuclear names: URA, NLR, NUCL, CCJ, DNN, USU, URRE, UEC, URG
Tue, Mar. 25, 5:55 PM
- Cameco (CCJ) has climbed nearly 10% in five weeks, but BMO analyst Edward Sterck doesn't see more upside ahead and downgrades shares to Market Perform from Outperform; he says the stock is priced at a uranium price of $48-$65/lb., far above the current mid-$30s where it has been mired for months.
- On the other hand, Sterck is optimistic about uranium, and notes CCJ's stock price usually moves in advance of the uranium price, "which could provide a further indication that that an increase in the uranium price may be imminent."
- ETFs: URA, NLR, NUCL.
Thu, Mar. 20, 10:24 AM
- Denison Mines (DNN +7.4%) signs a letter of intent to acquire uranium assets from International Enexco (IEXCF); DNN would buy all of Enexco's shares but spin off the copper assets, which will become part of a newly formed company.
- Enexco's principal uranium assets include a 30% stake in the Mann Lake exploration project and a 20% stake in the Bachman Lake joint venture in Saskatchewan.
- Also, DNN says it intersected high grade uranium mineralization at a new target area near the Phoenix deposit at Wheeler River in Saskatchewan; DNN is the operator and holds a 60% interest in the project, while Cameco (CCJ) holds a 30% stake.
CCJ vs. ETF Alternatives
Cameco Corp is engaged in the exploration for and the development, mining, refining, conversion, fabrication and trading of uranium for sale as fuel for generating electricity in nuclear power reactors in Canada and other countries.
Other News & PR