Cameco Corporation produces and sells uranium worldwide. The company operates through Uranium, Fuel Services, and NUKEM segments. The company was founded in 1987 and is based in Saskatoon, Canada.
CCJ Price Forecast Based on DCF Valuation
DCF Fair Value Target:
The table below illustrates the output of a discounted cash flow forecast using a variety of scenarios for Cameco Corp. To summarize, we found that Cameco Corp ranked in the 99th percentile in terms of potential gain offered. Our DCF model suggests the stock is undervalued by 47449%; returns of such proportions should be viewed with some skepticism, though. The most interesting components of our discounted cash flow analysis for Cameco Corp ended up being:
Its compound free cash flow growth rate, as measured over the past 5.06 years, is 2.52% -- higher than 96.45% of stocks in our DCF forecasting set.
Cameco Corp's effective tax rate, as measured by taxes paid relative to net income, is at 21 -- greater than 81.87% of US stocks with positive free cash flow.
Relative to other stocks in its sector (Basic Materials), Cameco Corp has a reliance on debt greater than only 24.28% of them.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
ZKIN, PQG, CMT, TMST, and NTR can be thought of as valuation peers to CCJ, in the sense that they are in the Basic Materials sector and have a similar price forecast based on DCF valuation.
After a decade long bear market, the time to invest in uranium has finally arrived. The largest uranium miners, Cameco (CCJ) and Kazataprom, began cutting production in 2018, leading to market with a supply deficit as a new contracting cycle approached. Then COVID-19 happened, causing further cuts in supply and...
Our Man In NYC on Seeking Alpha | September 8, 2020
Cameco (TSX:CCO)(NYSE:CCJ) could have attractive upside, as energy diversification needs potentially reshape the Canadian economy. The post Buy This 1 Rare TSX Stock for Huge Upside Potential appeared first on The Motley Fool Canada .