Why Uranium Energy Stock Just Dropped

Key Points

• BMO Capital just downgraded Uranium Energy stock.

• At the same time, H.C. Wainwright raised its price target on the very same stock.

• Analysts are confused about the stock's value -- no surprise, since Uranium Energy has never earned a profit.

• 10 stocks we like better than Uranium Energy ›

Uranium Energy (NYSEMKT: UEC) stock slipped 2% through 10:45 a.m. ET Thursday after BMO Capital pulled its outperform rating and downgraded Uranium Energy to market perform.

Uranium Energy shares have more than doubled over the last 12 months, but BMO thinks this stock's run is done, and values Uranium Energy at $14, just a hair above its current share price of $13 and change.

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For this reason, BMO's of the opinion it's time to step to the sidelines and seek better bargains among nuclear stocks.

Image source: Getty Images.

Point, counterpoint

It's not all bad news for Uranium Energy investors, however, because at the same time BMO is pulling back and downgrading, investment banker H.C. Wainwright is raising its price target on Uranium Energy stock.

As The Fly reports, Wainwright hiked its price target on buy-rated Uranium Energy stock to $19.75 this morning, citing "impressive strides in project development," and calling Uranium Energy a "prominent benefactor" from geopolitical changes in the uranium space.

(I presume they must have meant "prominent beneficiary.")

Is Uranium Energy stock a buy?

So here we have two nuclear analysts, with one saying Uranium Energy is worth $14, and the other 41% more than that -- but for the life of me, I can't imagine how they're coming up with these numbers.

Uranium Energy hasn't ever earned a profit in its more than two-decade history, and just ended fiscal 2025 with a $0.20-per-share loss. Analysts who follow the stock see Uranium Energy turning profitable in 2027, and growing its earnings to $0.26 per share by 2029, which is as far out as estimates go. That still leaves the stock costing 50 times the profit it might (or might not) earn four years from now, though.

To me, that seems too expensive to buy.

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Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.