Energy Fuels (UUUU +9.03%) experienced a modest effervescence this Tuesday, a seven per cent ascent by 11:50 a.m. Eastern Time. The cause, predictably, was a bullish pronouncement from B. Riley’s Mr. Matthew Key, who has seen fit to raise his price target to $27, accompanied by the customary ‘buy’ recommendation. One wonders if the gentleman has recently visited the White Mesa facility; a bracing experience, I gather.
The Allure of Rare Earths
Apparently, Energy Fuels has, thus far in 2026, outperformed its nuclear brethren. The rationale, according to TheFly.com, hinges on a confidence in White Mesa’s rare-earth refining capabilities and, more importantly, the prevailing winds of American policy concerning critical minerals. A comforting narrative, naturally. Further gains, we are told, might manifest in several ways.
A flurry of downstream mergers and acquisitions could inflate valuations, progress in the uranium business is, of course, desirable, but the true potential, one suspects, lies in the company’s flirtation with rare earths. The validation of terbium oxide reserves and a Final Investment Decision regarding the Donald Project in Australia are, apparently, key. One pictures breathless anticipation in the boardrooms.
A Most Delicate Calculation
It is, however, instructive to note what Mr. Key conspicuously omits from his enthusiastic assessment. There is no mention of the company’s escalating cash burn, a phenomenon that has plagued Energy Fuels for the past two years. Nor does he dwell on the equally troubling subject of losses, which appear to be accumulating with commendable consistency.
Analysts, polled by S&P Global Market Intelligence, anticipate a doubling of revenues this year compared to 2025. A most impressive feat, if achieved. However, they also foresee a continuation of losses and a relentless depletion of cash reserves. GAAP earnings might turn positive next year, a slender hope, but free cash flow is expected to remain stubbornly negative, at least until 2028. A prolonged period of fiscal discomfort.
With a mere $235 million languishing in the bank, and forecasts predicting a burn rate exceeding twice that amount over the next three years, one is forced to conclude that Energy Fuels, despite Mr. Key’s optimism, remains a decidedly speculative proposition. A sell, in my estimation, though one hesitates to deprive the bulls of their fleeting amusement.
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2026-01-20 20:22