Topic: How To Invest

Stock Pickers Digest Hotline – Friday, November 3, 2017

Article Excerpt

CAMECO CORP., $10.84, symbol CCO on Toronto, is the world’s biggest uranium producer. Not only does it have large, high-grade reserves spread across several mining sites, it has low-cost operations and significant market share. In the three months ended September 30, 2017, the company’s revenue fell 27.5%, to $486 million from $670 million. Sales volumes fell 1.1%, to 9.2 million pounds of uranium from 9.3 million. More important, Cameco’s realized price for uranium dropped 25.2%, to $32.42 U.S. a pound from $43.37. As well, in February 2017, Tokyo Electric Power canceled a supply contract with the company worth about $1.3 billion in revenue through 2028. Cameco is disputing Tokyo Electric’s assertion it has the right to do that. An arbitration hearing is set for early 2019. Uranium’s long-term outlook is positive, but supply remains much higher than demand. Low oil prices should also keep prices down in the near term and could slow the construction of new reactors. OUR RECOMMENDATION: Cameco is still a..