Perth uranium stocks rocket after Sprott raises money for future buying spree of the nuclear fuel

The likes of Paladin Energy, Boss Energy and Deep Yellow all gained at least 15 per cent on Monday following a deal that is set to lift uranium prices.

Sprott announced it sold US$100 million ($154m) worth of units in its physical uranium trust to Canaccord Genuity. The global asset manager successfully hawked the units at US$17.25 each, which is $US0.27 above the current unit price.

Canada’s Sprott is intending to use the money received to buy uranium after the transaction settles on June 20.

“If the entirety of this raise will go towards purchasing uranium, we estimate the demand from this raise at Friday’s spot price of approximately US$70 (per pound) equates to approximately 1.43 million pounds (of uranium oxide),” Citi analyst Paul McTaggart said.

“Total utility demand is more than 180 million pounds of (uranium oxide) per year but most of this is done through term contracts — hence we believe this amount could potentially move spot prices, given it is a very thinly traded market.”

Deep Yellow led the winners with a 21.2 per cent rise, Boss jumped 17.7 per cent, Paladin was up 15.6 per cent, Bannerman Energy gained 14.3 per cent and Lotus Resources leapt 12.9 per cent.

Boss and Paladin are the two most shorted stocks on the ASX.