Bell Potter just upgraded this ASX uranium stock

The broker believes recent weakness has created a buying opportunity.

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Boss Energy Ltd (ASX: BOE) shares were on form on Wednesday and charged 4.5% higher following the release of its half-year results.

This means that the ASX uranium stock has now almost doubled in value over the last 12 months.

But if you thought the gains were over, think again.

This morning, the team at Bell Potter has upgraded the company's shares to a buy recommendation and is tipping big returns for investors from current levels.

ASX uranium stock named as a buy

According to the note, Bell Potter has upgraded Boss Energy's shares to a speculative buy rating with a slightly trimmed price target of $6.34.

Based on its latest share price, this implies potential upside of almost 30% for investors over the next 12 months.

The broker believes that recent share price weakness has created a buying opportunity for investors with a high risk tolerance. Particularly given the strong outlook for uranium demand and recent corporate developments which have diversified its operations.

The broker explains its reason for upgrading the ASX uranium stock this morning:

Our valuation is reduced slightly to $6.34/sh (previously $6.41/sh) on changes to our corporate expenditure and associated earnings. With the recent sell-off in BOE we have decided to move to a Speculative Buy (from Speculative Hold) in-line with our ratings structure. Uranium fundamentals continue to support our thesis being 1) advancement in Nuclear energy across the globe (60 reactors currently under construction) filtering through to a growing demand for U3O8 and 2) a lack of near-term supply as producers exited the market post Fukushima.

The recent acquisition of a 30% interest in the Alta Mesa joint venture, diversifies BOE's operations and revenue streams, making BOE one of only two geographically diversified uranium producers in CY24.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. 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 Scott Phillips.

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