Uranium became a bit of a sticky subject in Australia about a year ago after the party championing it federally suffered its worst electoral defeat in living memory. Our ASX charting expert says that ASX uranium stocks are red hot, and highlighted a few that will blow up by the end of the year.
Speaking to Peter Switzer on a new-look Switzer TV this week, Fairmont Equities’ Michael Gable says that uranium is well-placed for a ramp up on the ASX.
Gable says the gap between uranium supply and demand is the best he has seen in his career. With Paladin Energy already up threefold over twelve months, he expects a “two in front of it” before year-end.
Paladin Energy will clear $20 a share before the end of 2026. That is the call from Michael Gable, founder of technical analysis and equities research firm Fairmont Equities, made on the show this week.
Having spent a bit of time with Gable in the studio over the years, he’s normally pretty conservative. But this time our chartist-in-residence has strong conviction.
While showing his chart for Paladin, he described it as a “very, very bullish looking chart”.
“I think it’s one of the best setups I’ve ever seen in terms of the gap between supply and demand for uranium. We do have…uranium exposure for our clients. Most of our clients are holding the Uranium miners ETF. But some of my clients are holding Paladin, which is obviously the major company here in Australia.”
Paladin Energy (ASX: PDN)
Paladin’s share price has tripled over the past twelve months. Gable’s view is that the recent flat trading is consolidation rather than topping.
“Even though it’s tripled from where it was a year ago, I think what it’s doing at the moment is consolidating,” he said. “I’ve circled that on the chart. I think this is just a sideways consolidation and it’s getting ready to head higher again. So I wouldn’t be surprised.
“I’m very confident Paladin’s share price will have a two in front of it before the end of the year. I think it’s a buying opportunity, a great stock to buy on the dip. That’s been the history of it.”
Watch the interview:
The structural case
The structural argument behind the call is one Gable briefly elaborated on the show. He asserted the supply-demand setup, while Peter Switzer drew out the framing.
“I guess you’re arguing also that there’s a structural demand change for this product?” Switzer said.
“Yeah,” Gable replied.
“And probably the Middle East issue has raised – it will only help,” Switzer added.
“That’s right,” Gable said.
The two agreed that uranium is benefiting from a structural shift in nuclear demand independent of the current geopolitical environment, but that the Iran conflict has accelerated the trend rather than created it. The Middle East situation, in their reading, is a tailwind on a setup that was already favourable.
For investors who want to take the position Gable described, he flagged two routes. Most of his clients hold the Sprott Uranium Miners ETF, the broader basket of uranium-exposed names. Some hold Paladin directly.
So, start the clock, I guess! By year-end we’ll know if Paladin cleared $20 or didn’t.
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