Cameco Gains 7% Despite Q2 Earnings Miss: How to Play the Stock?

Cameco CCJ reported second-quarter 2026 results on Friday. Total revenues were down 7% year over year to CAD 814 million ($588 million) on lower sales volumes despite higher prices. Adjusted earnings plunged 75% year over year to CAD 0.18 per share or 13 cents. While revenues beat the Zacks Consensus Estimate, earnings fell short.

Alongside its earnings release, Cameco announced that Westinghouse Electric Company, jointly owned with Brookfield Renewable Partners, has confidentially submitted a draft Form S-1 registration statement to the U.S. Securities and Exchange Commission for a proposed initial public offering of its common stock. 

Investors looked past the earnings miss, sending Cameco shares up 7% following the results. In the past six months, Cameco shares have declined 21.9% compared with the industry’s 3.2% dip. Meanwhile, the broader Oils-Energy sector has moved up 7.1%, while the S&P 500 has climbed 10.8%. 

Cameco has outperformed peers like Ur-Energy Inc. URG and Energy Fuels UUUU, which have declined 22.6% and 46.1%, respectively.

Cameco’s 6-Month Price Performance vs. Industry, Sector & Peers

Image Source: Zacks Investment Research

Let us delve deeper into the company’s second-quarter results and long-term prospects before assessing whether to buy, hold or sell the stock.

Lower Volumes Weigh on Cameco's Q2 Performance

Uranium production declined 15% year over year to 3.9 million pounds. Output at McArthur River/Key Lake increased 28% to 2.3 million pounds, but this was more than offset by a 43% decline at Cigar Lake to 1.6 million pounds following its scheduled annual maintenance outage.

Uranium sales volumes fell 18% to 7.1 million pounds, reflecting normal quarterly delivery timing and Cameco's disciplined contracting strategy, which calls for lower planned deliveries in 2026.

Cameco’s uranium revenues were down 7% to CAD 659 million ($469 million). The 18% decline in sales volumes was offset by a 15% increase in the Canadian dollar average realized price to CAD 93.13 per pound due to the impact of market-priced contracts on its portfolio. 

Fuel Services also posted weaker results. Production decreased 6% to 3 million kgU, while sales volumes fell 18% to 3.6 million kgU. Segment revenues declined 6% to CAD 152 million ($108 million), as higher realized prices were unable to offset lower deliveries.

Overall, Cameco’s revenues were down 7% to CAD 814 million ($588 million) due to weaker performance in both segments.

Total cost of sales inched up 1% to around CAD 624 million ($446 million). In the uranium segment, costs climbed around 3% due to a 26% increase in the average unit cost of sales, partially offset by lower sales volume. Costs were higher due to higher purchased material costs, product loan impacts and the Cigar Lake maintenance shutdown. Costs in the Fuel Services segment rose 1% as a 21% increase in the average unit cost of sales due to mix of products and services was offset by lower sales volume.

Adjusted EBITDA was down 42% year over year to CAD 391 million ($279 million). Adjusted earnings declined 75% year over year to CAD 0.18 per share or 13 cents. The decline was due to lower uranium sales volumes and a sharp reduction in equity earnings from Westinghouse. In the prior-year quarter, Westinghouse recognized significant revenues from its participation in the Czech Republic's Dukovany nuclear project, contributing roughly $170 million to Cameco's share of Westinghouse's revenues and adjusted EBITDA.

Cameco Expects Slightly Lower Revenues in 2026

Cameco maintained its uranium production projection between 19.5 million pounds and 21.5 million pounds for 2026 despite temporary operational disruptions at Key Lake and McArthur River in May, and at Cigar Lake in July. Production guidance for the fuel services segment is 13 million to 14 million kgUs.

Cameco expects uranium deliveries of 29–32 million pounds for 2026. Uranium revenue guidance now stands at CAD 2.7-2.9 billion, based on a higher realized price assumption of CAD 91-96 per pound. At the midpoint, uranium revenues would decline about 2% from 2025 due to lower delivery volumes. Fuel Services revenues are projected at CAD 610-650 million, implying roughly 12% year-over-year growth.

Overall, Cameco expects total 2026 revenues of CAD 3.32-3.57 billion. The midpoint represents about a 1% decline from 2025.

CCJ’s Earnings Estimates See Upward Revision Activity

The Zacks Consensus Estimate for Cameco’s earnings for both 2026 and 2027 has moved up over the past 60 days, as shown in the chart below.

Image Source: Zacks Investment Research

The consensus estimate for Cameco’s earnings for 2026 indicates year-over-year growth of 27.2%. The same for 2027 implies growth of 55.8%.

Image Source: Zacks Investment Research

Cameco’s Valuation Looks Stretched

CCJ stock is trading at a forward price-to-sales ratio of 15.97 compared with the industry’s 4.99. CCJ’s Value Score of F suggests that the stock is not so cheap and a stretched valuation at this moment.

Image Source: Zacks Investment Research

Energy Fuels is trading higher at 16.20 while Ur-Energy is a cheaper option, trading at 4.70.

Westinghouse IPO Plans Add Another Long-Term Growth Lever

Cameco continues to benefit from its strategic investment in Westinghouse, which helps broaden its exposure beyond uranium mining into nuclear technology and reactor services. In June, the U.S. Department of Energy announced a conditional commitment of up to $17.5 billion through its Office of Energy Dominance Financing to support procurement of long-lead components for up to 10 new Westinghouse AP1000 reactors in the United States.

Westinghouse has a pipeline of 91 potential AP1000 reactor opportunities (105 GWe) globally, providing a significant long-term growth runway. Westinghouse’s proposed IPO, if completed, could unlock shareholder value, improve financial flexibility and increase visibility into the business, creating another potential catalyst for Cameco investors.

CCJ’s Long-Term Fundamentals Remain Strong

Cameco continues to strengthen its long-term portfolio. It has long-term obligations to deliver an average 28 million pounds of uranium annually over the next five years. These agreements provide strong revenue visibility, stable cash flows and support future investment plans. 

Cameco’s uranium production capacity accounts for nearly 15% of global output and it is further investing to expand production to capture favorable market conditions. This includes extending Cigar Lake’s mine life to 2036 and ramping up output at McArthur River and Key Lake toward their licensed annual capacity of 25 million pounds (100% basis). The company recently increased ownership interest in Cigar Lake to 57.418%, which further supports its focus on proven tier-one assets.

Growing energy security concerns, geopolitical uncertainty and the global transition toward low-carbon electricity continue to support long-term uranium demand. Combined with its exposure to Westinghouse's reactor business, Cameco remains well-positioned to benefit from the ongoing nuclear power renaissance.

Should You Buy Cameco Stock Now?

Cameco remains one of the strongest long-term investment opportunities in the uranium space, supported by world-class mining assets, long-term contracts and increasing exposure to nuclear technology through Westinghouse. However, new investors can wait for a better entry point, considering the premium valuation and the lower revenue expectations for the year. The stock currently carries a Zacks Rank #3 (Hold).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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