Uranium stocks are the latest to catch the attention of Reddit’s WallStreetBets community, and rising uranium futures prices have caused a Wall Street analyst to raise its triuranium oxide price targets .
The analyst: On Tuesday, Bank of America analyst Lawson Winder reiterated the rating of Neutral Cameco Corp. (NYSE: CCJ) and raised the target price from $ 20 to $ 29.
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The thesis: Winder raised its triuranium octoxide price target in 2021 by 18% to $ 36.30. It also raised its 2022 target by 41% to $ 53.50 and its 2023 target by 18% to $ 48.50.
In the last month, the price of uranium futures has jumped around 40% to $ 42.40, a seven-year high.
In this same stretch, Cameco shares are up 47.1% and Winder said on Tuesday that the rise in uranium prices is already reflected in the price of Camecon shares at the moment.
He said stocks are likely to remain volatile in the short term as it is the only large liquid stock in the United States with significant exposure to uranium.
“However, we believe that any potential increase in prices in the short term would be temporary. We see that our current perspective is largely reflected in the actions, ”Winder said.
Winder said the Sprott Physical Uranium Trust (OTC: SRUUF) alone has increased global demand by about 3% since August 17th. Winder said producers will certainly respond to rising prices by increasing supply, but this new supply will take a while to go online. Meanwhile, Winder said the SRUUF fund will likely continue to trade higher.
In addition to Cameco, several uranium penny shares traded on the stock exchange have experienced extreme volatility this week. In the last five business days, Peninsula Energy Ltd. (OTC: PENMF) increase by 40.1%, Energy Resources of Australia Limited (OTC: EGARF) increases by 40.2% i Yellow cake PLC Shares (OTC: YLLXF) are up 23.2%.
Take from Benzinga: Uranium is the latest investment in memes that social media has taken by storm, and pouring the volume of retail trade into relatively illiquid OTC-listed uranium stocks has certainly created extreme volatility in the short term.
Uranium prices may continue to fall in the short term until more online supply occurs, but traders can expect uranium stocks to end up following a similar long-term trajectory in most transactions. of extremely short 2021 low-value meme.