Cameco Corporation (CCJ -4.53%) stock, which initially seemed to be moving higher after reporting 2024 earnings yesterday, ended up losing a penny's-worth of stock price. The selling is getting even worse today, and as of 11:05 a.m. ET, Cameco stock is down 4.9%.

Why?

I suspect the earnings news is partly to blame. But also partly is the uranium market.

Cameco earnings and the uranium price chart

Despite growing sales 21% year over year in 2024, Cameco's earnings plunged more than 50% to just $0.39 per share. Management says "the outlook for nuclear power and nuclear fuel fundamentals is more favorable than it has been for decades" and "predicts strong financial performance to continue in 2025."

But the trend is not Cameco's friend. From highs near $95 a year ago, the price per pound of uranium has plunged roughly 31% over the past year. At last report, uranium prices were hovering around $65 per pound, arguably the worst of both worlds.

It's above the $60 price that experts say is the breakeven point, where miners are encouraged to increase production (and therefore supply, driving prices down). But it's not far enough above $60 that miners like Cameco can be assured of earning strong profits for a while, even as prices slide lower (because of the increasing supply).

Is Cameco stock a buy?

As a result, Cameco is valued at north of $19 billion today but has earned just $119 million over the past 12 months -- a sky-high price-to-earnings ratio of 162. Granted, when valued on free cash flow (FCF), Cameco stock looks a bit more attractive. Last year, the company generated a stellar $482 million in positive FCF, pulling its price-to-free-cash-flow ratio down to just 40.

That might actually be a reasonable valuation if Cameco were growing its earnings. With earnings on the decline, however, and the uranium price chart suggesting the situation is worsening, I'm afraid I still cannot recommend buying Cameco stock today.