Energy Fuels UUUU is currently trading at a forward 12-month earnings multiple of 5.63X, at a 113% premium to the non-ferrous mining industry’s 2.64X. UUUU’s Value Score of F suggests that the stock is not so cheap and indicates a stretched valuation at this moment.

Image Source: Zacks Investment Research

The Energy Fuels stock has declined 28% in the past 12 months against the industry’s 8.1% growth. The Zacks Basic Materials sector has been unchanged over the past year, while the S&P 500 has risen 19.6% in the same timeframe.

The UUUU stock’s decline aligns with the 32% decrease in uranium prices seen over the past year. Energy Fuels’ lowered production outlook for 2024 due to the suspension of transportation from Pinyon weighed on the stock’s performance as well.

Energy Fuels Stock’s 1-Year Performance Vs Industry, Sector & S&P 500

Image Source: Zacks Investment Research

Meanwhile, peers Centrus Energy LEU and Cameco CCJ have gained 117.8% and 6.2%, respectively. Uranium Energy UEC has dipped 12.5% in the past 12 months, but it has fared better than Energy Fuels.

Technical indicators show that Energy Fuels has been trading below the 200-day simple moving average (SMA) since Jan. 1, 2025. The stock is also currently trading below the 50-day SMA. Following a death crossover on Feb. 3, 2025, the 50-day SMA continues to read lower than the 200-day SMA, indicating a bearish trend.

UUUU Shares Trade Below 50 & 200-Day SMAs

Image Source: Zacks Investment Research

Given the significant pullback in Energy Fuels’ shares, investors might be tempted to snap up the stock. But is this the right time? Let us understand the company’s strengths and weaknesses to better analyze how to play the stock.

Pinyon Concerns Impact Energy Fuels’ 2024 Outlook

UUUU had paused ore shipments from its Pinyon mine in Arizona following concerns raised by the Navajo Nation about transporting radioactive materials through their lands. However, mining continued, with the mined ore being stockpiled at the site. Factoring in this setback, Energy Fuels lowered its 2024 production guidance to 150,000-200,000 pounds of finished uranium in 2024 from the prior stated 150,000-500,000 pounds.

In a major development, UUUU, Navajo Nation Department of Justice and Navajo Nation Environmental Protection Agency signed a landmark agreement in January 2025, and ore transport is expected to have resumed in February. 

With no contract sales scheduled for the fourth quarter of 2024, Energy Fuels had stated that it would look for opportunities to sell uranium on the spot market to take advantage of any price increase. We expect UUUU’s 2024 uranium sales to be lower than the substantial sale of 560,000 pounds in 2023.  This suggests a maximum sale of 1,10,000 ounces of uranium for the fourth quarter of 2024.  

Uranium spot prices averaged $76.75 per pound for the fourth quarter of 2024, declining 7% year over year. This is expected to get reflected in Energy Fuels’ fourth-quarter 2024 revenues when it reports its results on Feb. 27, 2025.

Selling, general and administrative expenses are expected to have risen due to increased salaries and benefits related to the additional headcount associated with the business enhancement efforts.

The Zacks Consensus Estimate for UUUU’s revenues for the fourth quarter is $45.25 million, indicating a significant jump from the year-ago quarter's reported figure of $0.47 million.

The estimate for Energy Fuels’ fourth quarter is pegged at break-even earnings, suggesting an improvement from the loss of 13 cents per share reported in the fourth quarter of 2023. The estimate has been unchanged over the past 60 days.

Image Source: Zacks Investment Research

UUUU to Post Loss in 2024, Prospects Looks Good for 2025

Earnings estimates for 2024 for Energy Fuels are pegged at a loss of 10 cents, suggesting a slight improvement from the loss of 12 cents incurred in 2023. The expectation of lower sales amid a weak backdrop for uranium prices will likely lead to a full-year loss for UUUU in 2024.

However, the picture for the next year holds promise. Earnings estimates for 2025 are pegged at 7 cents, which indicates that analysts expect the company to deliver its first year of profit since it started trading on the NYSE in December 2013.

Image Source: Zacks Investment Research

Energy Fuel’s Acquisitions Highlight Diversification Efforts

UUUU is ramping up uranium production while advancing rare earth element (REE) capabilities to capitalize on the surge in demand for both in clean energy technologies. The acquisition of Base Resources Limited in October 2024 gave Energy Fuels access to the promising Toliara Mineral Sand Project. In addition to REE metals, this move will strengthen UUUU’s potential to become a major producer of titanium and zirconium minerals.

The Toliara project ensures a long-term supply of monazite that can be processed to produce advanced REE materials at its White Mesa Mill, a cost-effective and capital-efficient strategy. In December 2024, the Madagascar government lifted the suspension on the Toliara project (which had been in place since November 2019), and UUUU can now develop this project.

With the RadTran LLC buy, Energy Fuels made its foray into the medical isotope market. These play crucial roles in cancer treatment. Using RadTran’s know-how, UUUU will recover valuable isotopes from its process streams, recycling the material that would otherwise have been lost to disposal, which is a win-win situation for the company.

UUUU Focus on Boosting Uranium Capacity to Bear Fruit

Energy Fuels has four long-term contracts with major U.S. nuclear utilities that require deliveries of base quantities of 2.8 million pounds of uranium from 2025 to 2030.

The company is preparing two additional mines in Colorado and Wyoming (Whirlwind and Nichols Ranch), which could increase uranium production to a run rate of more than two million pounds per year as early as 2026. UUUU is advancing several other large-scale U.S. mine projects to raise the capacity to 5 million pounds annually to bet on the robust uranium market conditions.

Average Target Price for Energy Fuels Suggests Solid Upside

Based on short-term price targets offered by four analysts, the average price target is $8.54 per share. The average suggests an 87% upside from yesterday’s closing price of $4.56.

Image Source: Zacks Investment Research

Should You Buy UUUU Stock Now?

Even though uranium prices have declined so far this year, we believe that this is temporary as supply pressure and solid demand fundamentals point to higher sustained uranium prices in the future. Despite how the upcoming earnings play out, Energy Fuels seems set to deliver its first year of profit in 2025. Backed by its debt-free balance sheet, the company is advancing with its growth plans to capitalize on the expected surge in uranium and REE demand. Those who already own the stock may stay invested, given Energy Fuels’ solid long-term prospects in the uranium and REE markets. 

Considering its premium valuation, new investors should monitor UUUU’s developments for a more appropriate entry point. The stock’s Zacks Rank #3 (Hold) supports our thesis.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Cameco Corporation (CCJ) : Free Stock Analysis Report

Energy Fuels Inc (UUUU) : Free Stock Analysis Report

Uranium Energy Corp. (UEC) : Free Stock Analysis Report

Centrus Energy Corp. (LEU) : Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research