As it looks, uranium stocks are beginning to recover after the recent crisis that was driven by the tragedy in Japan. The shares of Energy Fuels Inc. (TSE:EFR), (PINK:EFRFF) have started their huge come-back too.
After hitting a 3-month low of $0.415 last Thursday, EFR is now gaining strength again. Over the last two sessions, it added 54% to its value, closing yesterday at $0.64 per share.
This rise is hardly surprising. The recent sharp fall in uranium stocks was triggered by the disaster in Japan that led to a decrease in uranium prices too. Still, many analysts were convinced that the negative effects after Japan’s earthquake will be only short-lived and will soon pass away.
So it happened. Uranium stocks are on the rise again. Will they manage to climb to the levels before the crisis? We should wait to see.
In the case of Energy Fuels, it is hard to tell how high the shares could go. The large turnovers from the last days suggest the surge might continue. EFR is moving up on rising volumes, which is principally a bullish sign. Yesterday, more than 8.7M shares changed hands – it exceeds nine times the average turnover for the last 30 trading days.
In addition, Energy has announced several positive developments over the last two months. To name a few: in February the company expanded its mineral resources in Utah; on Mar. 7 the Colorado Department of Public Health and Environment (“CDPHE”) granted Energy Fuels a final Radioactive Materials License to construct and operate the Piñon Ridge uranium mill near Naturita in Colorado.
The latest news release was from last Thursday when the company announced the terms of its public offering for gross proceeds of up to $10M. The financing is expected to be completed at the end of March.
These are much needed funds for Energy Fuels. Not counting them, the company had just $2.5M in cash and a working capital of $2.2M at the end of 2010. This does not seem quite sufficient, taking into consideration that only for the last quarter of 2010 Energy Fuels spent more than $1.2M in cash.
