Macquarie has run the ruler over the ASX-listed uranium companies, and the analyst team believes there's plenty of value to be had.
Four of the five companies they've assessed are trading at share prices that equate to a spot price lower than Macquarie's assumptions, meaning there's likely share price upside based on their modelling.
Let's have a look at what they're saying.
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Paladin Energy Ltd (ASX: PDN)
Macquarie said Paladin had successfully ramped up production at its Langer Heinrich mine in Namibia and was also making "real progress" on its Patterson Lake South approvals in Canada.
Paladin recently reported that for the March quarter it had produced 1.29 million pounds of uranium at Langer Heinrich, up 5% from the previous quarter, "driven by strong processing plant performance''.
The Patterson Lake South Project had also had its environmental impact statement approved.
Macquarie said Paladin's share price underperformance against NexGen Energy (ASX: NXG), Cameco, and ASX-listed Namibian project developers "seems unwarranted".
Macquarie added:
We now see value in the shares, which imply a US$77/lb uranium price. We recognise downside risk to FY27 consensus production forecasts still exists into guidance, but investors are now being rewarded for taking this risk on, in our view.
Macquarie upgraded Paladin to outperform with a price target of $13.25.
Bannerman Energy Ltd (ASX: BMN)
Macquarie said that, with Bannerman's Etango project approaching a final investment decision and a partnership with China's CNNC substantially reducing funding needs, Bannerman shares were looking interesting.
Macquarie has an outperform rating on Bannerman shares with a price target of $5.55.
Deep Yellow Ltd (ASX: DYL)
Macquarie notes that Deep Yellow's Tumas project has completed earthworks and is entering the civil works phase, which could last 10 to 12 months.
Macquarie added:
Given its strong cash balance, DYL has at this stage preserved full flexibility on final investment decision timing. It is selecting a construction contractor, and is engaging with potential strategic partners on the project (including from the US).
Macquarie has an outperform rating on Deep Yellow shares with a price target of $2.25 per share.
Lotus Resources Ltd (ASX: LOT)
Lotus, Macquarie said, at its recent quarterly retracted some past production results and announced a series of management changes, with the shares subsequently falling more than 50%.
Macquarie said Lotus, which is already mining but not yet selling uranium, could need to raise capital if it faces delays getting export approvals.
Macquarie has a price target of $1.30 per share for Lotus, reduced from $1.90, which is still well above the current share price of 67.5 cents.
Boss Energy Ltd (ASX: BOE)
Macquarie said they still held concerns about Boss' downgrades to resources at the Honeymoon mine in South Australia and the new feasibility study.
Macquarie said:
It appears to be a smaller and more marginal asset than was widely believed under the prior management. However, we believe this is now more adequately reflected in the share price.
Macquarie upgraded its recommendation on Boss Energy to neutral from underperform and set a $2.25 share price target.
