Paladin Energy Ltd (ASX: PDN) shares were on form on Wednesday.
The uranium producer's shares rose almost 7% to finish the day at $9.13.
The good news is that Bell Potter believes there is a lot more to come from this ASX share.
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What is the broker saying?
Bell Potter was pleased with the mining company's performance during the fourth quarter, noting that it outperformed expectations. It said:
PDN reported quarterly U3O8 production of 1.3Mlb (BPe 1.1Mlb; FY26 4.8Mlb), sales of 1.4Mlb (BPe 1.2Mlb; FY26 4.4Mlb) and closing U3O8 inventory of 1.7Mlb on completion of mining and processing ramp-up. PDN realised an average price of US$71/lb (up 3% QoQ; FY26 US$70/lb). Production costs were US$52/lb (FY26 US$43/lb), up 28% QoQ reflecting the transition to full mining activities and depletion of stockpiled MG3 ore.
PDN outperformed FY26 guidance across all metrics. At 30 June 2026, PDN had cash and investments of US$265m (31 March 2026 US$220m), net cash (excluding leases) of US$113m and available liquidity of US$335m.
Looking ahead, FY 2027 is set to be another solid year for the company, with production expected to grow to between 5.1Mlb and 5.6Mlb.
However, it will be weighted to the second half of the year. Bell Potter commented:
PDN's FY27 guidance points to U3O8 production of 5.1-5.6Mlb and sales of 4.8- 5.3Mlb, weighted to 2H with ore feed grades to lift as mining progresses through J Pit and with maintenance shutdowns scheduled for 1H. Unit cost guidance is consistent with FY26 at US$44-48/lb and should trend lower throughout the year as production ramps. Capex (excluding capitalised stripping and building of low-grade stockpiles) of US$25-29m will target tailings storage construction, process optimisation studies and infill drilling.
Paladin Energy shares tipped to rocket
According to the note, in response to the update, Bell Potter has retained its buy rating on the company's shares with a trimmed price target of $14.80 (from $15.30).
Based on its current share price of $9.13, this implies potential upside of 62% for investors over the next 12 months.
Commenting on its recommendation, Bell Potter said:
We retain our Buy recommendation. We have a positive medium- to long-term outlook for the uranium market, supported by barriers to new supply and demand growth linked to electrification, energy security and AI-related power requirements. PDN has around ~53% exposure to spot prices out to 2030. Production at LHM continues to improve with higher-grade mined ore feeding the processing plant and continued process optimisation.
