Cameco (CCJ) Falls Sharper Than Market: Investors Should Know

With a change of -1.74% from the previous session's end, Cameco (CCJ) ended the most recent trading day at $49.59. The stock's daily loss of 1.46% lagged behind that of the S&P 500. The tech-heavy Nasdaq index fell 1.63% and the Dow fell 1.24%.  

A uranium producer's stock price increased 26.33% in the last 30 days, outperforming the 3.2% gain in the Basic Materials sector and the 1.6% gain in the S&P 500.  

When Cameco announces its financial results, everyone in the market will be watching attentively. Forecasts for the next quarter's earnings per share (EPS) indicate a 65% rise over the same period last year, coming in at $0.33.  

Anyone looking to invest in Cameco would do well to keep tabs on any changes made to analyst estimates. Most of these updates are a reflection of how quickly short-term business trends can change. Therefore, it is reasonable to interpret upward adjustments to estimates as an indication of confidence in the future of the company's operations.  

According to our findings, there is a clear relationship between these changes in estimates and the stock prices in the near future. To capitalize on this, we created the Zacks Rank, a unique methodology that considers these changes in estimates and offers a practical grading system.  

From 1 (Strong Buy) to 5 (Strong Sell), that is the Zacks Rank system. The #1 stocks have delivered an average yearly return of +25% since 1988, and it has an impressive track record of success according to independent auditors. The consensus earnings per share (EPS) forecast from Zacks has fallen 10.69% in the last month. The current Zacks Rank for Cameco is #5 (Strong Sell).  

Taking a closer look at value, we see that Cameco's Forward P/E ratio is 32.67 right now. When compared to the industry average Forward P/E of 16.47, this indicates a premium. Included in the Basic Materials subsector is the Mining—Miscellaneous business. Among all 250+ industries, this one ranks 158th on Zacks, putting it in the lowest 38 percent.  

By averaging the Zacks Rank of the companies that make up each industry group, the Zacks Industry Rank determines how strong those groups are. Based on our findings, the industries that rank highest outperform those ranked lowest by a factor of two to one.  

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