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Top 10 ASX Uranium Stocks to Watch in 2021


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As uranium prices hit multi-year highs, we examine ten ASX-listed companies with exposure to uranium assets.

Top 10 ASX Uranium Stocks to Watch in 2021
ource: Bloomberg
 
 

Uranium prices hit 5-year high in September

Uranium prices have run wild in the last month, with the commodity trading 36.3% higher in that period, last hovering around the $44.90 mark. That marks a five year high for the often overlooked commodity, which traded below the $20 mark in 2016.

This has corresponded to significant buying activity in global and in particular, ASX-listed uranium stocks, with the likes of Paladin Energy gaining 112% in the last month alone.

What’s the catalyst behind this latest surge? According to IG’s Senior Market Analyst, Joshua Mahony:

‘This largely illiquid market has been influenced heavily by the Sprott Physical Uranium Trust, which is providing major demand into a market that takes little to move price. The sheer size of Sprott’s other precious metal trusts highlights the potential impact it could have upon uranium prices.’

Looking ahead, Mr Mahony pointed out that that:

‘In total the Sprott trusts total $12 billion in funds. While the Sprott Trust is currently listed in Canada, their plan is to also post on the New York Stock Exchange. That could bring yet another bout of upside for uranium prices.’

There are some complexities to this recent price boom that investors and traders should be aware of, with Mr Mahony noting that:

‘Notably, while we have seen the price of uranium jump from $34 to $42 in a very short space of time, it is argued that many producers refuse to restart operations until prices reach something close to $70.’

Best 10 ASX uranium stocks to watch in 2021

Despite those concerns from the production-side, as with the recent run up in iron ore prices that triggered a rally in Australian iron ore stocks, this recent bullish uranium price action has seen many ASX-listed uranium stocks surge, as investors aggressively move from trend to trend.

To that end, the below table highlights some of Australia’s largest and most important uranium companies, ranked in terms of market capitalisation:

Company

Ticker

Market Capitalisation

Share Price*

1-Month Performance

Paladin Energy

PDN

$2.73bn

$1.02

+112.50%

Energy Resources of Australia

ERA

$1.70bn

$0.46

+68.52%

Boss Energy

BOE

$683.48m

$0.30

+87.50%

Deep Yellow

DYL

$407.79m

$1.20

+81.82%

Bannerman Energy

BMN

$385.54m

$0.36

+157.14%

Peninsula Energy

PEN

$288.85m

$0.30

+130.77%

Lotus Resources

LOT

$285.09m

$0.30

+100.00%

Vimy Resources

VMY

$254.46m

$0.24

+118.18%

Alligator Energy

AGE

$219.90m

$0.079

+163.33%

Elevate Uranium

EL8

$167.74m

$0.70

+157.41%

*Data correct as of 15 September, 2021.

How to buy or invest in uranium stocks on the ASX

You can gain exposure to ASX-listed uranium stocks two ways: either through share trading or derivatives trading. Share trading means that you take direct ownership of the stock, meaning you could potentially profit if the share price increases in value or if the company decides to pay a dividend.

By comparison to owning shares outright, derivatives trading – such as CFD trading – allows you to speculate on the price movement of a company’s shares without actually taking ownership of them. CFD trading may prove attractive to some investors for a number of reasons, including the flexibility to trade stocks long and short, the ease of which it allows to hedge, as well as the ability to gain larger exposure to an asset through leverage.

Follow the simple steps below to start investing or trading uranium stocks:

Investing in uranium stocks

  1. Create or log in to your share trading account and go to our trading platform
  2. Search for the company you wish to invest in
  3. Select ‘buy’ in the deal ticket to open your investment position
  4. Choose the number of shares you want to buy
  5. Confirm your purchase and monitor your investment

Trading uranium shares

  1. Create or log in to your trading account and go to our trading platform
  2. Decide whether CFD trading is right for you
  3. Search for the company you wish to trade
  4. Choose your position size and select ‘buy’
  5. Confirm your trade and monitor your position

Shane Walton | Financial Writer, Australia
15 September 2021

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