Dundee Capital Upgrades Uranerz Energy

Dundee Capital Markets upgraded Uranerz Energy Corp. (NYSE: URZ) Wednesday from Neutral to Buy with a C$1.50 price target.

The upgrade comes after news that the State of Wyoming deemed a mine permit application “complete.”

Analysts David A. Talbot and Aaron Salz viewed “the Uranerz pipeline in particular as very hand-to-mouth, requiring successful permitting of a series of projects, one after the other, to ensure steady future production."

“Its goal thus far is working. Over the past few years exploration advanced numerous smaller roll-front uranium deposits, delineated them in order to permit. We believe that timing will be everything when it comes to permitting as we don’t want to see production disruptions.”

“With our NAV intact and URZ off, our C$1.50/sh target implies a 47 percent lift. With few producers, high priced contracts, and URZ trading at a discount to peers, we see an entry opportunity for investors,” according to Talbot.

The analyst report concluded by noting that “Q2/14 cash is $2.9 MM with $20 MM debt. Another $12 MM was raised in July.

“URZ may be unable to achieve FCF break-even until ~$45/lb spot by our estimates. We have Uranerz running down its cash balance, potentially requiring financing by 2016E pending uranium prices.”

Uranerz Energy recently traded $0.98, up 7.69 percent.