Boss Energy Ltd (ASX: BOE) shares were on fire on Wednesday.
The ASX 200 uranium stock ended the session 20% higher at $1.91.
This was driven by positive industry news and the release of a solid quarterly update.
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Is it too late to invest?
The good news is that the team at Bell Potter doesn't think it is too late to invest in Boss Energy shares.
But before we get into that, let's see what the broker is saying about the company's performance during the first quarter.
According to the note, Bell Potter was pleased with its performance, highlighting that its production and sales were ahead of expectations. It said:
BOE produced quarterly 385klbs of U3O8 (BPe 365klbs) +11% QoQ, from Honeymoon, and received 45klbs from its 30% JV interest in Alta Mesa. Sales were 400klbs for the quarter (BPe 300klbs), with a further 100klbs returned under the loan agreement with enCore. The average realised price was US$74.7/lb for quarterly revenue of A$57m.
C1 costs were lower QoQ at A$34/lb (vs A$36/lb in 4QFY25), and AISC was A$50/lb. Inventory on hand increased slightly from 1.41Mlbs to 1.44Mlbs. Cash added to the balance sheet was $11.2m, following receipts of $36m and the loan repayment of $15m. The Honeymoon Review is on track for finalisation in the current quarter and remains the key near-term catalyst.
Honeymoon coming
Bell Potter notes that it is cautiously optimistic on the Honeymoon Review, which will have a big impact on its production outlook beyond 2026. It said:
The market is focused on the Honeymoon Review, due for completion (and release) in the December 2025 quarter. A delineation program of 390 holes for 49,200m (which commenced in mid-Sep) is drilling the entire Honeymoon domain on a 35x35m spacing and will inform part of the review. The production outlook hinges upon the results from the review, with the company attempting to hedge its bets via advancing permitting for Brooks Dam, Jasons and Goulds Dam, however this will take time.
Ultimately the viability of Honeymoon is based on the wellfield economics. The optimisation in C1 costs (fell 5.5% QoQ due in part to re-agent optimisation and recycling) and the firming in the spot uranium price, improve the outlook for Honeymoon beyond FY26, and we maintain cautiously optimistic.
Big potential returns
The note reveals that Bell Potter has retained its buy rating and $2.90 price target on Boss Energy's shares.
Based on its current share price of $1.91, this implies potential upside of 52% for investors over the next 12 months.
The broker concludes:
Our Buy recommendation and $2.90/sh target price are unchanged. Our valuation assumes production at Honeymoon over the short 10Y mine life is limited to ~1.7Mlbs pa and costs remain elevated, until such a time that management can guide differently. EPS changes in this report are FY26 +21%, FY27 -3%, FY28 +2%.
