Weekly Reports | 1:39 PM
This story features PALADIN ENERGY LIMITED, and other companies.
For more info SHARE ANALYSIS: PDN
The company is included in ASX100, ASX200, ASX300 and ALL-ORDS
Uranium prices remain range-bound amidst quiet activity overall. ASX shares received a shellacking. Industry forecasts remain positive.
- UBS, Morgan Stanley remain bullish on uranium
- NexGen Energy attracts broker enthusiasm
- Lotus continues to face production challenges
- Google and Constellation Energy agree on 15-year energy supply agreement
By Danielle Ecuyer
UBS tweaks its price forecast
After a week when some of Australia’s U308 stocks were taken out to the wood chopper, with meaty double-digit share price falls for Paladin Energy ((PDN)), Peninsula Energy ((PEN)) and Deep Yellow ((DYL)), UBS was prepared to buck the momentum trend.
Across the resources sector, the broker prefers copper, lithium and uranium. For the latter, the 2026 price forecast has been tweaked down by -US$1 to US$88/lb, but the medium-to-longer-term optimism remains.
UBS is structurally upbeat and stays positive over the medium term, with longer-term contracts expected to be set at over US$100/lb compared to U308 spot price forecasts of around US$90/lb.
Forecast prices for 2027 remain unchanged at US$95/lb and 2028 at US$100/lb, advancing to US$105/lb in 2029 and US$110/lb in 2030.
Diving into the stocks, NexGen Energy ((NXG)) remains the preferred large cap with a target of $18.50.
Paladin Energy was upgraded to Buy from Neutral on the view the stock had been sold down too deeply, with a $12.10 target price.
Bannerman Energy ((BMN)) remains Buy-rated. The broker considers Etango fully funded following the recent equity capital raisings, which resulted in a -17% decline in the target price to $4.39 due to dilution.
Morgan Stanley’s update on metals and mining equally nominates uranium as one of three most preferred exposures, after respectively gold and silver.
This broker expects stronger utility contracting and constrained mine supply to support uranium prices, forecasting spot prices of US$100/lb in the March quarter of 2027.
Paladin Energy remains one of this broker’s preferred exposures, with an unchanged Overweight rating. The latter is supported by Langer Heinrich reaching full mining operations and longer-term growth potential at Patterson Lake South.
The broker’s target price is reduced to $10.45 from $12.05.
In a preview to Paladin’s September quarter update, RBC Capital retains an Outperform rating and $13.50 target. RBC expects a “quiet” quarter with no major surprises with production and sales volume to be lower than previously indicated due to a maintenance shutdown.
The 1H27 production forecast is lowered by -75klb for the maintenance and marked-to-market 1Q27 realised U308 price, lowering the net profit forecast by -1%.
Ord Minnett offered a synopsis of Boss Energy’s investor presentation, which saw management outline what this analyst refers to as “speculative” potential to lift production to around 2.5mlbs with the addition of satellite feed sources, from around 1.9mlbspa of production under the Honeymoon-only scenario.
Scale is crucial to unlocking the upside potential from its installed capacity, which sits at 2.5mlbs, the broker emphasises.
Lifting feedstock production facilitates a decline in AISC to around $61/lb from $90/lb, which has scope to generate $35mpa in free cash flow, albeit not until the late 2030s.
Management pointed to the potential for scaled production to come from Goulds Dam (600klbs), which is viewed as speculative for now.
For Ord Minnett, this sits beyond its regular investment outlook, and consequently, the broker retains a Sell rating and $1 target.
Morgan Stanley has downgraded Boss to Equal-weight from Overweight with Honeymoon’s revised plans confirming mine life through 2035, but lower grades and higher costs will impact on cash generation.
Its target slips to $1.40 from $1.65.
NexGen in focus
Barrenjoey has initiated coverage of NexGen with an Overweight rating and $14.80 target price.
Like other commentators, Barrenjoey highlights nuclear power as being acknowledged as a clean energy source which will be required to meet global clean energy targets.
The U308 price has risen some 10% year-to-date in 2026. As utilities enter the long-term market to secure supply, the price is expected to rise further, particularly as the supply side has been constrained by a suite of factors, including delayed investment decisions and disappointing delivery.
Barrenjoey forecasts a US$110/lb price for 2027 compared to consensus at US$93/lb and spot around US$90/lb.
The long-term price forecast is US$100/lb compared to consensus at US$87/lb.
The U308 developing producer has one of the largest undeveloped projects in Canada, in the Athabasca Basin, which is anchored by Arrow, a very high-grade deposit with a 23,700ppm U308 reserve grade and circa 230mlbs to be produced over an 11-year life.
The analyst models first production in 2030, aligned with consensus, at a life-of-mine C1 cost of CA$15.2/lb which is up 9% since the August 2024 DFS.
Barrenjoey models around CA$2.75bn as a more conservative estimate, some 25%-plus above the company’s budget costing (DFS) of CA$2.2bn.
An estimated additional CA$2.5bn in funding will be required either in debt, prepayments, equity or strategic partnering.
Lotus is moving, albeit slowly, in the right direction
Lotus Resources ((LOT)) equally captured the attention of analysts last week.
Ord Minnett points out Lotus now has three permits from Namibia in hand, with discussions ongoing for the final transport permit with the Radiation Protection Authority.
Management is noted as “optimistic” and has begun assembling a four-container shipment of 144klbs of U308. The broker indicates Lotus has agreed to a 3mlb prepayment facility with Mercuria, which would enable payment once containers are on board the ship, thereby shortening the five-month working capital cycle.
There is potential for Lotus to generate its first revenue this calendar year. Management is also discussing the sale of 173klbs of off-specification U308 that Orano would not accept.
On the other side of the ledger, Ord Minnett views production in September of only 100klbs, with the acid plant running at 50%-60% of nameplate capacity, as a negative.
Recoveries need to increase from 52% in the June quarter, which has scope to be supported by no further power constraints and improved acid plant performance.
Ord Minnett retains a Hold, High Risk rating with a higher target of 25c from 24c, stressing Lotus remains an “extreme risk-reward” exposure but has the potential to be a proverbial “ten-bagger”.
Canaccord Genuity agrees key risks remain for Lotus, despite the mid-August restart, which generated 100klbs over 31 days despite acid shortages, power disruptions and optimisation work.
Annualising the result equates to a rate of around 1.18mlbpa, assuming no interruptions, which is some 50% of the 2.4mlbpa steady-state target.
The prepayment facility was secured after considerable due diligence and paves the way for Mercuria to market up to 3mlbs over 30 months at market-linked pricing.
The expected improvement in working capital, lowering cash tied up in inventory over a 5–7-month cycle, is positive, alongside the pro forma cash position of around $125.3m.
After adjusting for the capital raising, debt financing, operational update, as well as capex and sales timing, Canaccord’s target price falls to 70c from $2.30. A Speculative Buy rating is retained.
Costs and ramp-up risks have been identified as ongoing potential challenges.
Quietly range-trading
TradeTech reports last week was another quiet one in the U308 spot market, with three transactions concluding and the U308 spot price indicator slipping -US$0.05/lb to US$89.70/lb.
The spot market remains in a trading range, with buyers happy to participate when the price falls and sellers accepting prices near or at current published levels to meet year-end goals, the consultants point out.
In the term U308 market, several transactions were concluded off-market for delivery of material in the first and second quarters of 2027. Contract prices aligned with current prices, with a slight escalation to reflect a delivery window into next year.
The TradeTech Mid-term price indicator stands at US$91/lb and the Long-term price indicator at US$97/lb.
Regarding the nuclear power space, Google and Constellation Energy signed an agreement to bring 890MW of new nuclear capacity to the PJM grid, the largest grid, which serves much of the eastern US.
It is a 20-year power purchase agreement which will facilitate investments in new equipment and technology at eleven Constellation-owned nuclear units in Illinois, Pennsylvania and New Jersey.
A 15-year energy supply agreement for an additional 2.7GW in PJM’s fleet was also announced, with Constellation using Google Cloud and Gemini Enterprise technology for an “AI for energy” blueprint to assist in the optimisation of capacity, asset dispatch and infrastructure.
U308 shorters
Lotus Resources stands as the second most shorted stock on the ASX, as per ASIC data until 5 October, at 13.97%, up 0.71% over the prior week.
Boss is in third position at 13.12% and Paladin in tenth position at 11.45%.
Uranium companies listed on the ASX:
| ASX CODE | DATE | LAST PRICE | WEEKLY % MOVE | 52WK HIGH | 52WK LOW | P/E | CONSENSUS TARGET | UPSIDE/DOWNSIDE |
|---|---|---|---|---|---|---|---|---|
| 1AE | 09/10/2026 | 0.0500 | 0.00% | $0.16 | $0.05 | |||
| AEE | 09/10/2026 | 0.0900 |  – 6.32% | $0.26 | $0.09 | |||
| AEU | 09/10/2026 | 0.3500 | – 5.33% | $0.75 | $0.22 | |||
| AGE | 09/10/2026 | 0.0400 | – 5.41% | $0.06 | $0.02 | $0.080 |  100.0% | |
| AKN | 09/10/2026 | 0.0160 | – 5.88% | $0.03 | $0.01 | |||
| ASN | 09/10/2026 | 0.0400 | – 4.65% | $0.12 | $0.04 | |||
| BKY | 09/10/2026 | 0.6800 | 23.23% | $0.65 | $0.37 | |||
| BMN | 09/10/2026 | 3.1700 | – 4.56% | $5.25 | $2.77 | $4.433 | 39.9% | |
| BOE | 09/10/2026 | 1.3800 | – 9.03% | $2.15 | $1.00 | 14.8 | $1.514 | 9.7% |
| BSN | 09/10/2026 | 0.0270 | 8.00% | $0.07 | $0.02 | |||
| C29 | 09/10/2026 | 0.0300 | 3.70% | $0.04 | $0.01 | |||
| CXO | 09/10/2026 | 0.2500 | -16.95% | $0.43 | $0.11 | $0.300 | 20.0% | |
| CXU | 09/10/2026 | 0.0600 | – 5.88% | $0.17 | $0.02 | |||
| DEV | 09/10/2026 | 0.1600 | – 6.06% | $0.33 | $0.11 | $0.410 | 156.2% | |
| DYL | 09/10/2026 | 0.9600 | -10.50% | $2.97 | $0.96 | -79.5 | $2.050 | 113.5% |
| EL8 | 09/10/2026 | 0.2100 | – 6.67% | $0.50 | $0.20 | |||
| HAR | 09/10/2026 | 0.0600 | – 3.45% | $0.25 | $0.05 | |||
| I88 | 09/10/2026 | 0.1100 | 4.76% | $0.64 | $0.10 | |||
| KOB | 09/10/2026 | 0.0300 | 0.00% | $0.08 | $0.03 | |||
| LAM | 09/10/2026 | 0.5000 | – 0.99% | $0.93 | $0.49 | |||
| LOT | 09/10/2026 | 0.2100 | 0.00% | $3.20 | $0.20 | $0.250 | 19.0% | |
| MEU | 09/10/2026 | 0.0800 | 7.79% | $0.19 | $0.05 | |||
| NXG | 09/10/2026 | 12.6500 | – 4.51% | $20.47 | $11.72 | -114.9 | $17.050 | 34.8% |
| ORP | 09/10/2026 | 0.1000 | – 1.02% | $0.16 | $0.04 | |||
| PDN | 09/10/2026 | 8.4900 | – 6.88% | $15.10 | $7.45 | 37.2 | $12.686 | 49.4% |
| PEN | 09/10/2026 | 0.2100 | -14.58% | $1.08 | $0.20 | |||
| SLX | 09/10/2026 | 4.1100 | – 7.82% | $10.85 | $4.00 | |||
| WCN | 09/10/2026 | 0.0300 | 0.00% | $0.03 | $0.01 |
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For more info SHARE ANALYSIS: BMN - BANNERMAN ENERGY LIMITED
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For more info SHARE ANALYSIS: LOT - LOTUS RESOURCES LIMITED
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For more info SHARE ANALYSIS: PEN - PENINSULA ENERGY LIMITED