Monsters of Rock: Euroz goes bullish on uranium Boss, but Canaccord chops lithium price forecasts

Euroz puts buy label on Boss, bets on uranium producer to beat the shorts
Canaccord chops lithium price forecasts with surpluses forecast to 2028
Rio’s Robe River joins contest for Creasy-backed iron ore deposit

Good and bad in the latest updates on the future facing commodity space from Aussie brokers this week.

While some are calling the uranium stock sell off and shorting trend overblown, others are getting more bearish on the price recovery for lithium products.

We’ll start with the good news for fans of Boss Energy (ASX:BOE), which is heading into the back half of its first year as a uranium producer at its Honeymoon operation in South Australia and 30% owner of the EnCore Energy operated Alta Mesa project in the USA.

Recent ructions at the management level at EnCore have not helped and Boss has spent all of 2025 so far as the ASX’s most shorted stocks.

Its percentage of shares held short has surged to 23.11% as of last Friday, while spot uranium prices have fallen heavily from US$107/lb in early 2024 to US$64.50/lb today.

But some analysts are pushing back against that bearish outlook, with Euroz Hartleys’ Steven Clark re-initiating on Boss this week with a note that placed a $4.50/sh price target and buy rating on the ASX uranium producer.

That implies close to 81% upside on its price midweek, with Boss’ shares already up to $2.72 since. Allen called the short interest in Boss “unwarranted” and said a recent sell-off across the uranium sector provided an attractive entry point for investors.

“Despite an impressive DecQ’24 result and solid initial after-market, BOE has given back recent gains and remains the most heavily shorted name on the ASX with short interest building to 23% currently,” he said in a note.

“Recent weakness in uranium equities has largely been necessitated by softness in both sentiment and the thinly traded spot market, partially courtesy of Kazakh physical uranium fund ANU Energy liquidating its +2mlb inventory, uncertainty around US tariffs and misplaced concerns over the impact of a potential loosening of US-Russia EUP trade sanctions on U O supply and prices.

“Overhang from a May’24 share sell-down by BOE Directors and a ‘consensus’ bet on potential ramp-up woes and cost blowouts at Honeymoon as an ISR asset with a chequered operating history have also played a role in the build-up in short interest, in our view.”

The unwinding of the short trade could provide an opportunity for Boss longs as investors move to cover their positions if Boss shares rise from here.

Allen views Boss’ valuation as attractive on Euroz’ free cash flow forecasts.

“On our estimates, BOE has pulled back to undemanding valuation metrics of 0.65x P/NAV, 4.6x/2.9x FY26E/27E EBITDA with FY26E/27E FCF yields of 17%/22%, positioning the company attractively against its western peers. On our price deck, we forecast cash building to +A$450m by the end of FY27E, paving the way for further potential inorganic growth,” he said.

Broader uranium thesis

While spot prices are off 40% from their decade long highs seen in early 2024, term prices are hovering near a 17-year high of around US$80/lb.

Spot sales and contracting were significantly lower last year than in 2023, though Allen says the start to 2025 was encouraging as 17Mlb were placed under contract in January.

A primary supply deficit of around 40Mlb remains in place according to Euroz, which has a more bullish long term nominal price of US$90/lb, a figure that remains below what some analysts and miners view as incentive pricing to bring new mines into production.

In the broader uranium market there was good news for Kazakh giant Kazatomprom, which beat analyst expectations on earnings, revenue and profit, delivering a US$1.859bn net profit in 2024.

It has maintained production guidance of 25-26,500t (65-69Mlb) ahead of a revision at the Inkai JV with Cameco.

Despite that strong production number, capex and costs will be higher than the street expected in 2025, and Kazatomprom has flagged that it could purchase uranium on the spot market to bolster inventories, something described by Canaccord Genuity’s Alex Bedwany as a “bullish signal”.

Meanwhile, unseasonal rains have temporarily halted production at Paladin Energy’s (ASX:PDN) Langer Heinrich mine in Namibia, sending its shares almost 9% lower on Friday morning.

With the addition of the Rossing and Husab mines, Namibia supplies around 12% of the world’s primary uranium.

Boss shares were up 4%, while Deep Yellow (ASX:DYL), which owns the pre-development Tumas project in Namibia, was close to 5% higher.

Canaccord downgrades lithium prices

Canaccord Genuity was among the brokers who got behind the lithium market in its early stages.

But its latest forecasts suggest a longer winter for the battery metal, with the firm reducing price forecasts for the next few years and tipping market surpluses until 2028.

CG has trimmed its valuations by 24% on average for developers and explorers, and 15% for producers with Liontown Resources (ASX:LTR) moved from a hold to a sell.

That’s partly come about because of the impact of tariffs on Chinese EV producer in the US and Europe, along with an unwind of EV friendly policies under the Trump Administration and sliding EV production targets from Western OEMs.

CG is expecting an average 14% drop in annual EV sales from 2025 to 2030 compared to its previous estimates. While it thinks the market still grows 10% a year to 2035, that’s far below the 54% CAGR from 2020-2024.

Ameliorated by higher demand from battery energy storage systems – something a number of analysts and miners are now predicting to take up some of the slack – lithium demand is expected to rise at a 11% CAGR to 3.1Mt lithium carbonate equivalent, according to the broker.

While 220,000t of LCE has been taken out of the market through supply cuts from 2023-2025, that has failed to halt the impact from 540,000t of supply additions.

“While cuts have helped around the margin, they are a long way from moving the market back to balance, especially considering demand headwinds over 2025E/6E,” CG’s number crunchers say.

Prices for 6% Li2O spodumene concentrate are expected to average US$850/t this year, 5% higher than previously expected, with prices lifting early this year as miners trade into the cost curve.

But CG’s 2026 estimate has been cut 15% to US$850/t, 2027 down 37% to US$900/t and 2028 and 2029 off 35% and 25% respectively to US$1100/t and US$1500/t, the latter the long term price projection for the product.

Chemical pricing has been clipped similarly, with 2027 forecasts down 37% to US$12,857 for each of the lithium carbonate and hydroxide markets followed by Canaccord. Long term pricing of US$22,500/t is only expected to be reached in 2029.

Prices fell from around US$80,000/t in late 2022 to under US$10,000/t at the start of this year as a global supply rush ran ahead of EV and lithium demand growth.

“While there may be disconnections to pricing, ultimately the latent capacity within the system should keep a lid on pricing,” Canaccord’s analysts say.

“Arguably, we are below the goldilocks (US$1,000-1,500/t SC6) zone at spot pricing, but the supply that continues to come to market indicates to us that a slow thaw is the most probable outcome. That being said, the market is tightening, and if there were one or two high profile closures, we believe we’d see a much quicker balance and price response.”

Rio flies in on CZR

And if you thought the race was run at Mark Creasy’s CZR Resources (ASX:CZR), think again.

Weeks after announcing a board approved off-market takeover by small iron ore player Fenix Resources (ASX:FEX), its massive neighbour the Robe River JV has made a $75 million play for its Robe Mesa iron ore deposit in the Pilbara.

Local unlisted iron ore producer Gold Valley Iron yesterday was also revealed to have dropped a 31c per share cash bid for the junior, not determined by CZR to constitute a superior proposal.

Owned 53% by Rio Tinto (ASX:RIO) and the balance by Japan’s Mitsui (33%) and Nippon Steel (14%), the JV lobbed a bid for the project on Thursday.

It sits adjacent to Robe River’s Mesa F deposit, making it a logical consolidation play for the mining giant and its partners.

CZR’s board continues to recommend shareholders accept the scrip-based Fenix deal. But they have declared their intention to engage with Robe River.

“Based on the information contained in the Robe River JV Proposal, the CZR Board has determined in good faith after consultation with its external legal advisors that the Robe River JV Proposal is a Potential Competing Proposal (as defined in the BIA) that could reasonably be expected to lead to a Superior Proposal (as defined in the BIA) if it were to be proposed,” the company said in a statement today.

“Accordingly, the CZR Board has determined that the fiduciary exception applies and CZR intends to engage with Robe River JV in relation to the Robe River JV Proposal.”

It all comes after a $102m cash offer for Robe Mesa from Chinese-linked Miracle Iron collapsed after it sat with the Foreign Investment Review Board for over a year.

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