Should You Buy, Sell or Hold CCJ Stock Before Q2 Earnings Release?
The Zacks Consensus Estimate for Cameco's second-quarter revenues is $630.7 million, indicating 44.3% growth from the year-ago quarter's actual. The consensus mark for CCJ's earnings for the quarter is pegged at 36 cents per share. It indicates a significant improvement of 260% from the prior-year quarter's reported figure of 10%.
Over the past 60 days, the estimate has moved up 50%.
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Cameco's Earnings Surprise History
Over the trailing four quarters, Cameco's earnings missed the Zacks Consensus Estimate thrice and surpassed the same once. CCJ has an average trailing four-quarter negative earnings surprise of 48.50%. The trend is shown in the chart below.
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What the Zacks Model Unveils for CCJ
Our proven model does not conclusively predict an earnings beat for Cameco this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that is not the case here.
You can uncover the best stocks before they are reported with our Earnings ESP Filter.
Earnings ESP: The Earnings ESP for Cameco is +18.69%.
Zacks Rank: CCJ currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today's Zacks #1 Rank stocks here.
Factors Likely to Have Shaped Cameco's Q2 Performance
CCJ has a 69.8% stake in the McArthur River mine and 83% in the Key Lake mill — the world's largest high-grade uranium mine and mill. Cameco has a 54.5% interest in Cigar Lake, which is the world's highest-grade uranium mine.In 2025, the McArthur River/Key Lake and Cigar Lake operations are each expected to produce 18 million pounds of uranium. Cameco's attributable share of this total is projected at 22.4 million pounds, down slightly from 23.4 million pounds in 2024.The company has guided to uranium sales between 31 million and 34 million pounds in 2025 compared with 33.6 million pounds sold in the previous year.During the first quarter of 2025, Cameco's share of uranium production reached 6 million pounds, marking a 3% year-over-year increase. The impact on production of the planned maintenance shutdown at the Key Lake mill during the second quarter is expected to have been offset by improved mill availability at Cigar Lake. As a result, second-quarter production is likely to exceed the 6.2 million pounds recorded in the same period last year.
Fuel services (which include UF6 conversion, UO2 and heavy water reactor fuel bundles) production for 2025 is expected to be in the band of 13-14 million kgU. The company had produced 13.5 million kgU in 2024.
Production volume in the second quarter of 2024 was 2.9 kgU and sales volume was 2.9 kgU. We expect the second-quarter 2025 numbers to be higher than these levels and likely to have positively influenced CCJ's second-quarter performance.
Uranium prices have under pressure this year due to oversupply and uncertain demand. Prices have averaged $72.59 per pound during the second quarter, down 17% year over year. However, Cameco's second-quarter revenues are likely to reflect the impact of fixed-price contracts on the portfolio.
Meanwhile, the average unit cost of production at McArthur River/Key Lake is expected to have been higher, while the average unit production cost at Cigar Lake is expected to have trended down with increased planned production. The company has been lowering its debt levels, which is likely to have led to lower interest expenses, thereby boosting earnings.
Cameco has been progressing to lower administration, exploration and operating costs, which is likely to have helped offset the impacts of elevated costs on its earnings.
Cameco, in June, announced that it expects an increase of $170 million in its 49% equity share of Westinghouse Electric Company's (Westinghouse) 2025 second-quarter and annual adjusted EBITDA. This is tied to Westinghouse's participation in the construction project for two nuclear reactors at the Dukovany power plant in the Czech Republic. This is expected to aid Cameco's second-quarter results as well.
CCJ's Price Performance & Valuation
Cameco shares have appreciated 75.3% in the past three months, outpacing the industry's return of 5.5%. In comparison, the Zacks Basic Materials sector and the S&P 500 have gained 8.3% and 15.2%, respectively.
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Meanwhile, the company's peer Energy Fuels UUUU has surged 125% in the past three months while Uranium Energy UEC has gained 67.8%.
Cameco stock is trading at a forward price-to-sales ratio of 13.31 compared with the industry's 1.24. It is also above its five-year median of 6.60.
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The company is, however, cheaper than peer Energy Fuels' and Uranium Energy's price-to-sales ratios of 21.91 and 50.78, respectively.
Investment Thesis on Cameco
Geopolitical events, energy security concerns and the global focus on the climate crisis amid rising low-carbon energy demand have created tailwinds for the nuclear power industry. Given CCJ's high-grade assets and diversified portfolio spanning the nuclear fuel cycle, it is well-poised to capitalize on these trends. Cameco accounted for 16% of global uranium production in 2024.
Supported by a strong balance sheet, CCJ is making investments to boost its capacity. However, the current decline in uranium prices is concerning. Also, changes to the Mineral Extraction Tax for uranium in Kazakhstan will impact its earnings.
Should You Buy CCJ Stock Now?
Cameco is likely to deliver improved results in the second quarter, supported by higher sales volumes and contributions from the Fuel services segment and Westinghouse. However, an earnings beat seems unlikely in the quarter.
Considering CCJ's stretched valuation, steering clear of the stock for now seems prudent.
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Cameco Corporation (CCJ) : Free Stock Analysis Report
Energy Fuels Inc (UUUU) : Free Stock Analysis Report
Uranium Energy Corp. (UEC) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
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