Shaw and Partners analysts believe there is now a disconnect between the share prices of Australian uranium producers and developers and the global uranium market, which has demonstrated significantly improved fundamentals.
The broker has this week published a research report naming its top picks in the sector and share price targets for each, which we'll get to shortly.
First, let's see what they're saying about the sector overall.
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Energy security driving uranium demand
To start with, Shaw and Partners said there is a divergence between company share prices and the improving uranium price.
They said:
The Global X Uranium ETF is down 31% over the past three months and has given back the gains in Jan/Feb to be down 9% in CY26. That is despite the long term uranium price improving to US$95.5 per pound – a record high, and with strong momentum to move higher. We view the pullback as an excellent buying opportunity.
Shaw and Partners said the drivers behind the strong uranium price continued to strengthen.
They said:
Nuclear energy has returned to favour with governments focused on energy security and decarbonisation. The conflict in the Middle East adds additional focus on energy security. On top of that, demand for clean, baseload energy for data centres and AI will add further demand for nuclear power. The US, China and India have all set ambitious targets to expand their nuclear industries. There are now 38 countries pledged to triple nuclear energy by 2050.
The broker said the World Nuclear Association estimates there are currently 372 gigawatts of nuclear capacity online; however, this is expected to grow to 686 gigawatts by 2040.
They added:
Existing mine production is only about 150Mlb of U3O8, so we need to add ~240Mlb of new mine supply in the next 14 years. When you consider depletion of existing mines, the required new supply is more likely to be >350Mlb. It is difficult to see where more than 150Mlb of that supply will come from. Sovereign strategic buyers have recognised the urgency to lock in nuclear fuel supply next decade. India and China are leading the way, and we expect to the US follow suit.
Massive share price upside for ASX uranium companies tipped
In terms of the Australian companies they like, they are: NexGen Energy Ltd (ASX: NXG) with a price target of $24.80, Paladin Energy Ltd (ASX: PDN) with a price target of $19.10, Silex Systems Ltd (ASX: SLX) with a price target of $14.30, Bannerman Energy Ltd (ASX: BMN) with a price target of $7.60, Boss Energy Ltd (ASX: BOE) with a price target of $3.08, Peninsula Energy Ltd (ASX: PEN) with a price target of 81 cents, and Atomic Eagle Ltd (ASX: AUE) with a price target of $1.70.
