Why is the Boss Energy (ASX:BOE) share price sinking 6% today?

The Boss Energy ASX: BOE) share price is sinking in morning trade, down 6%. We look at what’s moving the ASX uranium share’s price.

| More on:
down arrow chart

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Boss Energy Ltd (ASX: BOE) share price is sinking in morning trade, down 6.45% at 14 cents.

Boss Energy emerged from a trading halt this morning after entering the pause of trade on Thursday.

Below we take a look at the ASX resource share’s latest announcement on its uranium inventories.

What did Boss Energy report on its uranium inventory?

The Boss Energy share price is falling this morning after the company reported it had completed a $60 million capital raising at 14 cents per share. Boss Energy shares closed on the last trading day (Wednesday 24 March) at 16 cents per share.

The company will use the funds to acquire 1.25 million pounds (568,000 kilograms) of U-3 O-8 on the uranium spot market at US$30.15 (AU$39.67) per pound. The uranium is warehoused at the ConverDyn Facility in Metropolis, Illinois and will remain stored there following the deal’s completion.

Boss Energy said it would acquire 0.25 million pounds of uranium by the end of April, with the other 1 million pounds acquired by the end of June. The company plans to use the remaining funds from the capital raise to cover uranium storage costs and for general working capital.

Why the stockpile?

Citing tight supply amid strong demand for uranium and the potential for further future price rises, Boss said its increased stockpiles represented a “clear strategic value and upside” for its shareholders. Boss also reported the acquisition puts it in a better financial position for its planned re-start of the Honeymoon Uranium Project.

Commenting on the uranium stockpile increase, Boss Energy’s Managing Director Duncan Craib said:

We have been able to create this unique opportunity thanks to our highly experienced and well-connected operatives in the global uranium market. The stockpile will be highly valuable to us on several levels as we secure offtake agreements, finalise project funding and move into production.

Boss Energy share price snapshot

Despite today’s fall, Boss Energy shares are up 263% over the past 12 months. By comparison, the All Ordinaries Index (ASX: XAO) is up 36% in that same time.

So far in 2021, the Boss Energy share price is up 45%.

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Market News

Three business people join hands in strength and unity
Share Market News

Here are 3 ASX blue-chip shares reporting this week

Keep your eyes peeled for reports from these ASX heavyweights.

Read more »

A happy male investor turns around on his chair to look at a friend while a laptop runs on his desk showing share price movements
Share Market News

5 things to watch on the ASX 200 on Monday

The ASX 200 is expected to have a strong day on Monday...

Read more »

Two men lok sxcited on the trading floor.
Share Market News

5 ASX directors loading up on their companies’ shares in August

Who is buying more shares in Straker Translations, Eagers Automotive, and United Malt Group?

Read more »

A woman is excited as she reads the latest rumour on her phone.
Share Market News

‘Strongest tailwinds in a decade’: Morgans tips Telstra shares as a buy

Morgans is bullish on Telstra's shares...

Read more »

Top ten gold trophy.
Share Market News

Here are the top 10 ASX 200 shares today

These ASX 200 shares ended the week on a high.

Read more »

a shiba inu dog looks happily at eh camera with his tongue out while his owner hods him on his chest as he sleeps on a hammock.
Cryptocurrencies

Here’s why the Dogecoin price has had such a great week

Economic data out of the United States and a surprise announcement by BlackRock offered some healthy tailwinds to cryptos over…

Read more »

A pair of legs can bee seen on the floor buried under a pile of paperwork, indicating a high volume day
Share Market News

Here are the 3 most heavily traded ASX 200 shares on Friday

Our most traded ASX 200 share today has lost more than 10%. Ouch.

Read more »

A futuristic view of electric vehicle technology with speeding bright light trails indicating power.
Resources Shares

New records and looming deficits. Why ASX lithium stocks are in the spotlight

Demand for lithium is booming alongside rocketing growth in EV production, sending the price of the battery critical metal up…

Read more »