Revised Pricing Strategy Boosts CGN Mining Co’s Earnings Outlook and Reinforces Buy Rating

In a report released yesterday, Wayne Fung from CMB International Securities maintained a Buy rating on CGN Mining Co (CGNMF – Research Report), with a price target of HK$2.61.

Wayne Fung has given his Buy rating due to a combination of factors related to CGN Mining Co’s new pricing strategy and its potential impact on future earnings. The company has introduced a revised pricing formula for its off-take agreement with its parent company, which significantly increases the fixed price of uranium from 2026 onwards. This new pricing mechanism sets the fixed price at a much higher rate compared to the current agreement and industry standards, which is expected to enhance the company’s revenue streams.
Furthermore, the adjustment in the pricing formula is anticipated to remove uncertainties surrounding the company’s pricing strategy, thus providing a clearer outlook for investors. This change has led Wayne Fung to revise the earnings forecast for CGN Mining Co upwards for the years 2026 and 2027, reflecting a positive growth trajectory. As a result, the target price for the stock has been increased, reinforcing the Buy recommendation.