NEW YORK (TheStreet) -- Shares of Cameco Corp. (CCJ - Get Report) are lower by -2.40% to $19.51 in mid-afternoon trading on Wednesday, following the company's announcement it has to shut down production at its McArthur River mine and Key Lake mill, after receiving a strike notice from the United Steelworkers Local 8914.
The union told the uranium producer it will begin a strike at 12:01 am on August 30.
Cameco said the work stoppage involves approximately 535 unionized employees at its two locations, but added that it doesn't expect the strike to affect the company's 2014 uranium delivery commitments to its customers.
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The McArthur River mine and Key Lake mill are both located in Saskatchewan, Canada.
Separately, TheStreet Ratings team rates CAMECO CORP as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:
"We rate CAMECO CORP (CCJ) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we find that the stock has experienced relatively poor performance when compared with the S&P 500 during the past year."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 2.4%. Since the same quarter one year prior, revenues rose by 19.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The current debt-to-equity ratio, 0.34, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.35, which illustrates the ability to avoid short-term cash problems.
- CAMECO CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. During the past fiscal year, CAMECO CORP increased its bottom line by earning $0.79 versus $0.64 in the prior year.
- In its most recent trading session, CCJ has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. Looking ahead, our view is that this company's fundamentals will not have much impact in either direction, allowing the stock to generally move up or down based on the push and pull of the broad market.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. In comparison to the other companies in the Oil, Gas & Consumable Fuels industry and the overall market, CAMECO CORP's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- You can view the full analysis from the report here: CCJ Ratings Report
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