- Better days are ahead - eventually - for uranium, as production deficits could boost prices in the coming years, RBC Capital says in its Q3 mining and metals outlook.
- The firm thinks uranium prices are relatively range-bound near $20-$25/lb. in 2017-18 but as cost curve economics take effect and contract coverage declines in 2019-21, it forecasts an increase to $30-$40, with the market moving toward a deficit that may require new mine supply and resulting in uranium prices at $50/lb. in 2022, $60 in 2023-25 and $70 in 2026-28.
- Alongside its macro view, RBC starts Cameco (CCJ -0.9%) with an Outperform rating and a $16 price target, believing the company is well positioned to benefit from the eventual recovery in uranium prices, while operational efficiencies support improving free cash flow and dividends in the near term.
- ETFs: NLR, URA
- Now read: Uranium Spot Price November Bottom Threatened But Still Holding
Original article