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BETHESDA, Md. - The U.S. Department of Energy has exercised an option to extend Centrus Energy Corp’s (NYSE American: LEU) contract for producing High-Assay, Low-Enriched Uranium (HALEU) through June 30, 2026, the company announced today. The nuclear fuel producer, currently valued at $3.08 billion, has demonstrated remarkable market performance with a 324% return over the past year. According to InvestingPro analysis, the company maintains a strong financial position with more cash than debt on its balance sheet.
The one-year extension, valued at approximately $110 million, continues the partnership that began in 2019 to restore America’s uranium enrichment capabilities. The Department maintains additional options for up to eight more years of production beyond this extension. With a healthy gross profit margin of 29.72% and strong operational metrics, Centrus Energy appears well-positioned to execute on this contract.
Centrus completed the first phase of the contract in late 2023 by launching enrichment operations and delivering 20 kilograms of HALEU. Under Phase II, which concludes June 30, 2025, the company is producing an additional 900 kilograms of HALEU for the Department’s use.
The Department amended the contract on June 17, splitting the first three-year extension period into a one-year option followed by a two-year option. The Department has exercised the first of these options.
The HALEU produced belongs to the Department and can be used for national priorities including the demonstration and commercialization of advanced reactors that require this specialized fuel.
Centrus operates its HALEU production facility at the American Centrifuge Plant in Piketon, Ohio. The company won the original contract in 2019 to license and construct a cascade of advanced centrifuges to demonstrate HALEU production, followed by a competitively-awarded, three-phase contract in 2022.
This article is based on a press release statement from Centrus Energy. For deeper insights into LEU’s financial health and growth potential, including 16 additional ProTips and comprehensive valuation metrics, visit InvestingPro, where you’ll find detailed analysis and expert research reports covering 1,400+ top stocks.
In other recent news, Centrus Energy has been the focus of several analyst assessments and company announcements. Evercore ISI raised its price target for Centrus Energy to $205, citing the positive impact of TerraPower’s $650 million funding, which involves Centrus’s agreement to supply High-Assay Low-Enriched Uranium (HALEU). BofA Securities initiated coverage on Centrus Energy with a Buy rating and a $160 price target, reflecting an anticipated upside of about 22%, noting the company’s role in enriched nuclear fuel. William Blair also began coverage with an Outperform rating, highlighting Centrus’s unique position as a U.S.-owned uranium enricher with strategic market advantages.
Additionally, Centrus Energy announced an upcoming leadership change, with Shahram Ghasemian resigning as Senior Vice President and General Counsel, effective in 2025, and Richard Emery stepping in as Acting General Counsel. Analysts from Stifel highlighted Centrus’s strategic advantage in adapting to various forms of Low Enriched Uranium, which positions the company well in the evolving nuclear market. The company’s plans to expand its LEU production capacity by 2029 are part of a decade-long strategy to enhance its market presence. These developments underscore Centrus Energy’s strategic positioning within the nuclear sector as the United States aims to expand its nuclear capacity significantly.
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