Uranium Buy-In Signals Improving Market

(Wyoming Business Report, December 30) – Officials at uranium miner Energy Fuels pointed to a number of positive indicators for their market as they bought more than a million shares of their company at market prices.

Ames Brown, a director for the company, more than doubled down on his ownership of the company, buying 1 million shares to add to the 740,000 he already owned. Altogether, he now owns or controls 3.8 percent of the company’s shares, a move he told the company was “for investment purposes.”

Others in the company’s executive leadership have also been nabbing shares, though to what degree is uncertain from a release. President Stephen Antony and Executive Vice President of in-situ-recovery Paul Goranson have also purchased common shares of the company at market prices.

Antony called Brown’s buy-in a “strong vote of confidence” in the company, and said market forces are pushing the optimism including aggressive nuclear development in China, nuclear finally ramping back up in Japan after the devastating Fukushima incident in 2011 and a new nuclear reactor in the U.S. coming online.

“While worldwide uranium demand is growing, the low uranium prices of the past few years have slowed new investment in exploration and mine development,” Antony said. “We believe these and similar factors are likely to create substantial future supply constraints resulting in rising uranium prices.”

The company bought out Casper-based Uranerz in June to help weather the fuel’s downturn, with Goranson at the time saying both companies could have survived separately under less-than-pretty conditions, but the merger made it easier for both.

The company’s stock traded up by about 10 percent Wednesday on the news. The company’s stock has been rising more or less steadily for the last two weeks after bottoming out 38 percent below current levels in mid-December.

The Wall Street Journal recently reported that leadership invested in a company will perform significantly better than leadership more distanced from its markets. The paper said that a company whose leader holds 5 percent of the company’s shares will generate higher returns for an investor. The trend becomes more pronounced at 10 percent.

Goranson, in an email to the Business Report, said that he is confident uranium will soon see a resurgence. Despite not knowing exactly when the swing would occur, he decided now was right for him and knew his company’s stocks would reflect that anticipated improvement as well as any. That is especially true, he said, because of his confidence in the combined leadership at Energy Fuels that incorporates his former employer Uranerz.

“I don’t have any special insight into changes in the industry, but there are signals out there,” Goranson said. “Thanks to the recent climate change agreement, nuclear is becoming more visible as key contributor at economically meeting the goals.”

Original article here.