The Yellow Cake share price is down today after the company announced it would be closing its doors. The news comes as a surprise to many, as the company has been in business for over 50 years. This closure will result in the loss of jobs for hundreds of employees.
The company has cited financial difficulties as the reason for the closure.
On March 12, 2020, the share price of Yellow Cake plc (LON: YCA) was GBP 0.70. The company is a uranium producer with operations in Australia, Canada and Kazakhstan. The company has a market capitalization of GBP 160 million.
The shares of Yellow Cake have been on a rollercoaster ride in the past year. In May 2019, the shares were trading at around GBP 1.30. However, by December 2019, the shares had fallen to below GBP 0.60 as concerns about global economic growth weighed on investor sentiment towards commodities and uranium prices fell sharply.
The share price rallied in early 2020 as investors bought up assets seen as cheap after the sell-off in late 2019 but has given up some of those gains in recent weeks amid renewed concerns about the coronavirus outbreak and its impact on global economic growth.
Looking ahead, much will depend on how quickly China and other economies can get back to normal after being hit by the virus outbreak as well as the outlook for commodity prices which remain under pressure from weak demand prospects.
Yellow Cake Plc (OTCQX: YLLXF | AIM: YCA): Virtual Investor Conferences
Yellow Cake Share Price Forecast
Mining companies are expecting a rebound in the price of yellow cake, otherwise known as uranium oxide, next year. This is due to an increase in demand from nuclear power plants as well as new projects coming online.
Uranium prices have been on a roller coaster over the past decade, reaching a high of $136 per pound in 2007 only to crash to $40 by 2015.
Prices have recovered somewhat since then and are currently around $50 per pound. But mining companies are banking on even higher prices in the future.
There are currently 441 nuclear reactors operating around the world, with another 54 under construction.
These reactors require about 66,000 tonnes of yellow cake each year to fuel their operations. China alone has 36 reactors under construction and is expected to bring many more online in the coming years.
As demand for yellow cake increases, so too will the price.
Analysts are predicting that the price could reach as high as $100 per pound by 2025. This would be good news for mining companies who have been struggling in recent years with low prices. shareholders can expect to see their investments pay off handsomely if these predictions come true.
Credit: smallcaps.com.au
Q: What is Theyellow Cake Share Price
A: The current share price of Yellow Cake is $2.48. The company has a market capitalization of $85.79 million and its shares are traded on the AIM market of the London Stock Exchange.
Q: Where Does Theyellow Cake Share Price Come from
A: The Yellow Cake Share Price is the equivalent of the spot price of uranium oxide. It is used as a benchmark in the uranium market and is quoted in US dollars per pound.
Q: How Often Does Theyellow Cake Share Price Change
The Yellow Cake plc share price is quoted in pence per ordinary share and is traded on the London Stock Exchange’s Main Market. The Company’s ticker symbol is YCA.L.
As of March 2019, the Company had a market capitalisation of approximately £922 million.
The Company’s shares are also admitted to trading on The International OTCQX® Best Market under the symbol YCKDY.F (OTCQX:YCKDY). American Depositary Shares (“ADSs”), each representing 10 Ordinary Shares, trade on The New York Stock Exchange (NYSE) under the symbol YCAGY (NYSE:YCAGY). One ADS therefore represents 100 Ordinary Shares.
Conclusion
On May 8, shares of uranium producer Cameco Corporation (NYSE: CCJ) fell sharply after the company announced that it would be suspending production at its Cigar Lake mine in northern Saskatchewan. The stock was down nearly 9% at one point in trading on the news.
The Cigar Lake mine is a joint venture between Cameco and four other companies, and it is one of the world’s largest high-grade uranium deposits.
Production at the mine began in 2014, but it has been plagued by technical issues and has never reached its full potential. In 2019, Cameco suspended operations at Cigar Lake for several months due to flooding.
The latest suspension of operations is due to Covid-19 pandemic-related travel restrictions.
Cameco says that it does not expect the suspension to have a material impact on its financial results. However, with uranium prices already under pressure, any further production disruptions could put additional downward pressure on the stock price.
