Broker tips ASX uranium stock as a buy
According to a note out of Bell Potter, its analysts have initiated coverage on Nexgen Energy (ASX: NXG).
NexGen Energy is a Canadian focused uranium explorer and developer. Its flagship project is the very promising, high-grade Rook-1 project, which is situated in Saskatchewan, Canada.
Rook-1 is currently in the process of finalising permitting requirements with the Canadian Nuclear Safety Commission (CNSC). From receipt of the final federal permit, it will begin construction activities that are scheduled to take ~40 months. This should see first production in 2029.
Commenting on its initiation the broker said:
"We initiate on NexGen Energy Ltd with a Buy (speculative) rating and an $17.00/sh valuation. NXG is a 1:1 CDI on the TSX primary listing NXE, we will refer to NXE in this report. NXE's primary asset, the Rook-1 project, which includes the Arrow deposit, is one of the highest-grade uranium projects under development.
We estimate an un-risked NPV10% of C$5,546m for Rook-1, with optionality for additional production upside through other zones, for which we estimate are currently worth C$3,648m. Over the life of mine (LOM) we anticipate Rook-1 to average C$1.7b in EBITDA per annum.
We initiate on NexGen Energy Ltd with a Buy (speculative) rating and an $17.00/sh valuation. NXG is a 1:1 CDI on the TSX primary listing NXE, we will refer to NXE in this report. NXE's primary asset, the Rook-1 project, which includes the Arrow deposit, is one of the highest-grade uranium projects under development.
We estimate an un-risked NPV10% of C$5,546m for Rook-1, with optionality for additional production upside through other zones, for which we estimate are currently worth C$3,648m. Over the life of mine (LOM) we anticipate Rook-1 to average C$1.7b in EBITDA per annum.
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Very little chatter on this one. Above from Mottley fool on a MSN link.
Guess which ASX uranium stock just scored a buy rating from a leading broker
I honestly felt Bell potters $17 is a short-term price as the Rook 1 project is about a truck load only per day of pure u308 gold!
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