$Centrus(LEU)$ 🔺🅱️ULLISH🔺 Huge upside potential! Love where this stock is headed 📈 I have opened positions now!
Analysts 100% BUY 🟢
Source: Insider Monkey
Centrus Energy Corp. (NYSE:LEU)
Number of Hedge Fund Investors in Q1 2024: 9
Average Analyst Share Price Target Upside: 62.94%
Average Analyst Share Price Target: $69.33
Centrus Energy Corp. (NYSE:LEU) is a nuclear energy company that provides uranium fuel rods and other equipment for nuclear power plants. Its shares are down by 18% year to date, on the back of a disappointing first quarter earnings report which saw Centrus Energy Corp. (NYSE:LEU) report a net loss for the first time in more than a year. This is because the firm’s business is cyclical in nature, and it can only recognize revenue when its customers decide to execute their purchase agreements. Since Centrus Energy Corp. (NYSE:LEU) also depends on uranium imports for its fuel rods, it is also vulnerable to sanctions that came in place after the Russian invasion of Ukraine. However, it scored a win on this front in July 2024 when the US government gave it an import waiver. Centrus Energy Corp. (NYSE:LEU) also enjoys considerable advantages in the US energy market as it is the only uranium enricher and centrifuge manufacturer in America.
Source: Yahoo Finance
Centrus Energy Corp. (LEU) shares rallied 8.6% in the last trading session to close at $45.01. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 10.4% gain over the past four weeks.
Centrus Energy shares gained since the news that it inked a contingent supply agreement with Korea Hydro & Nuclear Power for a decade of low-enriched uranium deliveries to feed Korea's reactors. This deal has made a significant step forward in the company’s efforts to deploy uranium enrichment capacity at its American Centrifuge Plant in Piketon, OH. The collaboration with Korea Hydro & Nuclear Power is a critical step in Centrus' aim to re-establish a large-scale, U.S.-owned uranium enrichment facility. The company intends to expand the operation for large-scale manufacturing of low-enriched uranium and high-assay low-enriched uranium for existing and advanced reactors, pending appropriate funding and procurement agreements.
This company is expected to post quarterly earnings of $0.18 per share in its upcoming report, which represents a year-over-year change of -65.4%. Revenues are expected to be $56.5 million, up 10.1% from the year-ago quarter.
Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.
For Centrus Energy, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on LEU going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks Rank #1
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The recent movement in Centrus Energy Corp. (LEU) can be attributed to several factors:
Import Waiver: In July 2024, Centrus Energy received an import waiver from the US government, allowing it to import uranium for its fuel rods. This waiver was significant as it resolved the potential vulnerability to sanctions that came into place after the Russian invasion of Ukraine.
Collaboration with Korea Hydro & Nuclear Power: Centrus Energy announced a contingent supply agreement with Korea Hydro & Nuclear Power for a decade of low-enriched uranium deliveries. This collaboration is a critical step in Centrus' efforts to re-establish a large-scale, U.S.-owned uranium enrichment facility. It indicates progress towards deploying uranium enrichment capacity at its American Centrifuge Plant in Piketon, OH.
These developments have likely increased investor confidence in Centrus Energy's future prospects, leading to a surge in the stock price.
However, it's important to note that stock prices are influenced by various factors, and future price movements are subject to market dynamics and company performance. It's crucial to conduct thorough research and analysis before making any investment decisions.
Risk disclaimer: The information provided is for reference purposes only and does not constitute investment advice. Investing in stocks involves risks, including the potential loss of principal. Please consult with a professional financial advisor before making any investment decisions.
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