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Investing.com - BMO Capital raised its price target on Cameco Corp. (TSX:CCO) (NYSE:CCJ) to Cdn$120.00 from Cdn$110.00 while maintaining an Outperform rating. The uranium producer, currently trading at $78.63 with a market capitalization of $34.25 billion, has seen its stock surge 53% year-to-date.
The price target increase comes despite Cameco flagging risks to McArthur River production, with guidance dropping approximately 19%, which BMO Capital described as surprising in magnitude.
The impact on Cameco’s EBITDA appears limited, with fiscal year 2025 estimates reduced by only 3%, though the company will likely need to purchase more U3O8 from third parties, affecting free cash flow by approximately 5%.
BMO Capital noted that the supply deficit in uranium is now expected to increase, which could positively impact uranium pricing, particularly ahead of the upcoming World Nuclear Symposium.
The firm suggested this supply-demand imbalance could serve as a positive catalyst for increased contracting activity and potentially drive another improvement in market sentiment toward uranium producers.
In other recent news, Cameco Corporation reported impressive financial results for the second quarter of 2025, significantly exceeding analyst expectations. The company achieved an earnings per share of $0.71, surpassing the anticipated $0.35, which represents a 102.86% surprise. Additionally, Cameco’s revenue reached $877 million, well above the projected $585.4 million, marking a 49.81% surprise. Despite these strong financial results, the company has announced a reduction in its 2025 consolidated uranium production guidance by 3-4 million pounds, an 8% to 11% cut from the previously expected 36 million pounds. This adjustment excludes production from its Kazakh joint venture, Inkai. In light of the uranium outlook, BofA Securities has raised its price target on Cameco to C$130.00 from C$110.00, maintaining a Buy rating. These developments indicate a mix of strong financial performance and production challenges for the company.
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