Cameco (TSX: CCO) has already been a heavy hitter in 2024, and certainly through the last year. The uranium producer is up a whopping 94% in the last year alone. However, the company may now look a bit overpriced.
That’s why analysts are suggesting now could be the right time to look beyond Cameco stock. That’s especially as uranium spot prices are set to peak at $120 per pound by 2026, and $75 per pound long-term, according to analysts. In fact, there are many uranium companies that still haven’t realized their full price potential. So today, let’s look at another example beyond Cameco stock.
NexGen
For the next generation of uranium stocks, analysts are suggesting taking a look at NexGen Energy (TSX: NXE) as their top pick. Especially as the company looks as though it will be fully funded in 2024.
The company secured provincial environmental regulation approval in 2023, and now investors are ready to jump back on the stock. In fact, investors have already helped raise US$110 million in debentures, noted one analyst.
Therefore, analysts believe the uranium miner is set to see a strong 2024 while achieving several milestones. Federal approval is next, which NexGen should achieve in the first half of the year. After that, the company will likely look to secure financing for its first project, Rook I. But there’s more to consider for this stock.
Acquisition target?
Here’s the thing. Cameco stock is still the world’s largest publicly traded uranium producer, and has the cash on hand to hold the market in its fist. That means it likely wants to keep out other competitors, and that potentially makes NexGen stock an acquisition target.
Now that the stock is fully financed, and on the way to approvals, an existing producer like Cameco stock could step in and make a bid for the company. Especially as it looks to continue controlling the global supply or uranium in the near future.
However, Cameco stock isn’t alone. Other companies may be interested as well. Whether it’s to get away from oil and gas and shift towards uranium, or renewable energy companies looking to expand, NexGen stock could certainly remain a huge acquisition target.
Bottom line
Cameco stock remains a strong investment strategy for those looking to get into uranium. However, it’s quite expensive. That leaves NexGen stock looking like a strong pick that could certainly see a massively huge run in 2024 with federal approval.
It now remains a top pick among analysts pretty much across the board. It has strong finances, a secured growth opportunity, and is far cheaper than Cameco stock at just $10.50 per share as of writing. Shares may be up 66% in the last year, trading at 52-week highs. However, analysts predict a potential upside of at least 5% in the next year.
Should another company come along and snatch up NexGen stock, and as the company receives more approvals, that potential upside is only likely to rise higher for investors on the TSX today.
