Top 5 Asx Uranium Stocks 2024

Team Veye | 10-Jan-2024 Top 5 Uranium Stocks

Global demand for uranium is rising as nuclear deployments continue to trend up. The rising need for uranium in China and other parts of Asia, North America, and Eastern Europe is expected to sustain consumption of the material.

Nuclear power investment is once again on the rise in North America. After completing the construction of its new reactors, Georgia Power's Vogtle plant in the US is now supplying electricity to the grid.

Exploration and development of new uranium deposits are on the rise globally as stronger prices draw capital towards the sector.
The opening of Boss Energy’s Honeymoon mine in South Australia is expected to increase output in 2024. Boss Energy’s Honeymoon mine has been in care and maintenance since 2013, but is expected to produce around 1,100–1,200 metric tonnes of uranium per year for at least ten years. Boss Energy recently announced the completion of its first wellfield at the site. Other construction, including the water treatment plants and gypsum pond, is also close to completion.

Higher prices and production are expected to see export earnings surpass $950 million by 2024–25, as per the Department of Industry, Science, and Resources update.
               Uranium price outlook
 Fig: Uranium price outlook

In addition to being used to produce energy, uranium is also utilized in medical procedures like radiation therapy and x-rays. Australia is the country with the greatest uranium resource endowment in the world and is also one of the top producers of uranium

Source: Australian, Department of Industry, Science and Resources update.

Let’s look at some of the ASX commodities company’s significant involvement in exploration, development, and commercial activities in Australia and the rest of the world.

[Note]: The market cap and the share price of the selected ASX companies below are mentioned as of 10 January 2024.

Paladin Energy Limited (ASX: PDN)

Market Cap: $3.49 billion
CMP: $1.17
Sector: Energy

•    The PDN has a globally notable, high-grade exploration portfolio, a 75% ownership stake in LHM, and a 75% stake in the Michelin uranium project. All the requisite requirements for licences and permits are well in place. The company is on a clear pathway to becoming a globally significant independent uranium producer, helping the transition to a low-carbon global economy.

•    The group’s unrestricted cash and cash equivalents decreased by 28% to US$126,636,000 as of 30 June 2023. As of yet, the company has been waiting to materialise its operational activities into real numbers in its income statement. The cash flow streaming and recording in positive numbers are still far away, as the LHM production to materialise in the revenue numbers is expected to take some time.

Deep Yellow Limited (ASX: DYL)

Market Cap: $949.56 million
CMP: $1.243
Sector: Energy

The first quarter of the financial year 2024 saw the company make notable progress in the advancement of the Tumas Project and the Mulga Rock Project, which, although the two projects in focus, were not the only significant projects in the company’s pipeline. The positive results from the metallurgical test work could enable the company to boost the life of mine (LOM) from the current 22.5 years to 30+ years at Tumas while also facilitating an improved NPV and lower operating costs post-completion of the DFS.

Alligator Energy Ltd. (ASX: AGE)

Market Cap: $237.53 million
CMP: $0.062
Sector: Energy

•    Alligator Energy's proactive strides in uranium exploration, including data integration, project expansions, and progress in the Big Lake Uranium Project, affirm its commitment to advancing within South Australia's uranium sector.

•    Additionally, Alligator's having secured approval and funding from BHP Ltd. for copper ISR trials at Kapunda underscores ISR's increasing credibility in eco-friendly copper extraction. This partnership with ECL leverages expertise without hindering Alligator's focus on advancing the Samphire ISR Uranium Project's feasibility study through 2024. Moreover, Alligator's investment in ECL offers exposure to ECL’s in-situ recovery (ISR) copper projects.

Cauldron Energy Limited (ASX: CXU)

Market Cap: $40.78 million
CMP: $0.036
Sector: Energy

Cauldron holds a strong project pipeline and continues to drive simultaneous developments across multiple projects that assure strong revenue-generating and earning capability for the company in the coming years. This is primarily highlighted through the scoping study for one of the company’s primary projects, Melrose, with a project NPV of $449 million, a lucrative IRR of 79%, and a payback period of a mere 1.5 years, along with a substantial mine life of 11 years and a production rate of 1.5 million lb/year based on its current mineral resources.

Bannerman Energy Limited (ASX: BMN)

Market Cap: $487.71 million
CMP: $3.20
Sector: Energy

Bannerman stuck to its strategy to advance with the FEED and other key work streams on Etango that have driven the company’s progress at the project and advancement towards the construction phase. With the construction anticipated to take approximately 3 years to complete and the company having a modest operational expense base and substantial cash balances, it is in a well-capitalised state to carry out operations and fund a range of developmental expenses organically until the commercialization stage.

*All Data has been sourced from Company announcements and Refinitiv, Thomson Reuters

Frequently Asked Questions (F.A.Q)

Is there any demand for uranium?

The increasing trend in nuclear deployments and utilities' efforts to accumulate stockpiles in anticipation of a possible shortage in the mid-2020s are driving up demand for uranium globally. Growing demand in China and other regions of Asia, North America, and Eastern Europe is expected to sustain uranium consumption.

What is the outlook for uranium?

The Department of Industry, Science, and Resources of the Australian government projects that by 2024–2025, export revenues will exceed $950 million due to increased production and prices. Renewed exploration is also being driven by prices; in the June quarter of 2023, exploration spending will have reached $13 million, having doubled over the previous year.

Is it wise to invest in uranium now?

A number of factors, including the industry's supply and demand situation and attitudes towards the growing demand for nuclear power, contribute to the better future prospects of uranium.

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