A billet of highly enriched uranium that was recovered from scrap processed at the Y-12 National Security Complex Plant. Original and unrotated. Source: http://web.em.doe.gov/takstock/phochp3a.html (Photo credit: Wikipedia)

Paladin Energy* (PDN : TSX : $1.20)
Denison Mines* (DML : TSX : $1.43)
Cameco* (CCO : TSX : $20.87)

With news out Mondaythat one of the world’s largest publically-traded uranium producers has received a take-private buyout offer from its majority shareholder, shares of other potential targets were moving higher.

A common word used Monday by analysts commenting on the news was scarcity. There were already a limited number of high-quality uranium producers and established developers with world-class assets, and now if the take-private offer announced Monday goes through the supply of those type of companies will be even more scarce. Given that scenario, one Bay Street analyst highlighted that growing mid-tier producer
Paladin Energy will be the largest producer left and available for a take-out.

While another Bay Street analyst covering the uranium sector, stated that the most important read-through from Monday’s news is that the multi-billion take-private offer ”speaks to the upside of the uranium space and companies with access to high quality uranium resources and production.”

The analyst noted that the news “should serve as a wake-up call to the current, under-valued level of uranium equities and should
also bolster the scarcity value of the few remaining investible uranium equities.”

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