In an April 6 research note, Haywood Securities analyst Colin Healey reported that Uranium Energy Corp. (UEC:NYSE AMERICAN) purchased 705,000 pounds of physical uranium for its stockpile.
"Uranium Energy Corp. continues to take advantage of the strength of its share price and financial resources to build its inventory of physical uranium by making spot purchases below most industry production costs," Healey wrote. The company's current share price is about $3.16 per share.
The value of this latest uranium purchase, to be delivered in December 2022, is $21.8 million. This quantity bought takes Uranium Energy's physical inventory to 2,105,000 pounds and a value of about $65.3 million. Between its physical uranium, cash and equity holdings, the company now has about $110 million on its balance sheet.
For all of the uranium the company has purchased since announcing its plan to develop an inventory, it paid an average of $30 per pound. This is below the current uranium spot price, which is about $31.04 per pound.
In other news, Uranium Energy agreed to sell to investors 3,636,364 of its common shares at $3.30 apiece, generating $12 million in gross proceeds. This will take the company's cash on the balance sheet to about $73 million.
"We continue to rank Uranium Energy Corp. as a Top Pick," Healey wrote. "We recommend accumulating shares at the current price for maximum leverage."
Haywood has a Buy rating and a $3.50 per share target price on Uranium Energy, the current share price of which is about $3.16.
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