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Investing.com - UBS initiated coverage on Centrus Energy Corp. (NYSE:LEU) with a Neutral rating and a price target of $215.00 on Monday. The stock, which has surged over 460% in the past year according to InvestingPro data, is currently trading near its 52-week high of $249.42.
The investment bank believes Centrus is well positioned to benefit from policy tailwinds for the nuclear industry, growing focus on domestic supply chains, and significant electricity load growth. The company maintains a "GREAT" overall financial health score on InvestingPro, with notably strong profit and price momentum metrics.
UBS projects Centrus’ earnings per share to grow at a 10.9% two-year compound annual growth rate from 2025-2027, compared to consensus expectations of a 7.7% decline, driven by higher near-term prices for enrichment services.
The firm notes that Centrus currently trades at approximately 69 times its 2025 estimated earnings with a 10.9% EPS growth rate, resulting in a price-to-earnings-growth ratio of about 6x, which is triple that of the S&P 500.
UBS attributes this premium valuation to near-term enthusiasm for a U.S. nuclear revival, while cautioning that progress in the nuclear infrastructure build will likely be uneven due to its long-dated nature.
In other recent news, Centrus Energy has been the focus of multiple analyst reports, emphasizing its strategic position in the U.S. nuclear industry. Stifel has reiterated its Buy rating for Centrus Energy, setting a price target of $220, citing the company’s crucial role in addressing the weakened U.S. nuclear supply chain. Similarly, Evercore ISI maintained its Outperform rating, with a price target of $205, highlighting bipartisan support for nuclear energy expansion in the U.S. William Blair also reiterated an Outperform rating, pointing to Centrus’s unique status as the only American-owned producer of enriched uranium. The firm discussed the strategic transition of Centrus from an importer to a domestic uranium enricher, stressing the national security implications of its operations. Meanwhile, JPMorgan shared insights from investors who are intrigued by Centrus’s high risk/high reward profile but are cautious about its current valuation. These developments underscore the varied perspectives from analyst firms on Centrus’s potential in the evolving nuclear sector.
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