The average target price of DNN is 4.6 and suggests 169% upside potential. Usually, this means a BUY recommendation among investment firms, or a recommendation to increase one's position in this instrument in the next 12 months. The most optimistic analyst has a target price of 6.0. This translates into 251% upside potential in the best case. On the other hand, the most pessimistic analyst has a target price of 2.8. This suggests 61% upside potential. Even the most pessimistic analyst believes there will be stock growth. 

Denison Mines Corp. engages in the acquisition, exploration, development, extraction, processing, selling of, and investing in uranium properties in Canada. Its flagship project is the 95% interest owned Wheeler River uranium project located in the Athabasca Basin region in northern Saskatchewan. The company was formerly known as International Uranium Corporation and changed its name to Denison Mines Corp. in December 2006. Denison Mines Corp. was founded in 1997 and is headquartered in Toronto, Canada.

Canada

Denison Mines Corp.

Basic Materials

The company does not pay dividends at all, or it pays them sporadically. There have only been a few years with dividend payments in the past ten years. 

DNN reported revenue of CAD 4mn in the last 12 months, up 117% from FY23. At the same time, the dynamics of cash flow, as measured by free cash flow (FCF), were drastically different. Market expects EPS to reach CAD -0.05 in FY25.

Over the last six months, the stock performance has varied, with an increase following a drop. The stock's price trend wasn't definitive when matched against its global counterparts from the same sector and industry (as depicted above). Within the past six months, its performance has trailed this peer group's by 17ppts and its growth accelerated by 15ppts in the past month. This is equally valid for peers from the same country and industry. Given the stock's valuation versus its peers, its total price movement is neither favourable nor unfavourable.

The company has reported very poor EBITDA margins compared to its global peers in recent years. EBITDA margin amounted to -2012.6% in the last 12 months, a decline from -1556.8% in FY23. 

In the last 12 months, the return on capital employed (RoCE) declined to -13.6%, below the peers. The consensus estimate for FY24 for RoCE is 2.7%, again behind the peers. 

Denison Mines Corp. reported a return on equity (RoE) of -15.1% in the last 12 months, down from 16.8% in FY23. The market consensus projects an RoE of -7.5% in FY24, again behind its peers. 

Another important profitability metric, return on assets (RoA), amounted to -13.1% in the last 12 months, a decrease from 14.5% in FY23. The market analysts predict that RoA will be -6.7% in FY24, again weaker than its peers. 

The ratio of return on invested capital (RoIC) to the weighted average cost of capital (WACC) has been 0.0 in the past several years. This ratio implies a fragile shareholder value creation. 

The institutional, legal, and compliance risks associated with the company's country are minimal. In combination with stringent business standards, shareholder rights are very highly protected.

DNN boasts high trading liquidity. The average private investor can sell his common position in the stock immediately. Liquidity is usually quite stable and remains favourable on the days with the lowest activity. However, please consider that under highly turbulent market conditions, the trading volume tends to decrease significantly. 

No other major risks have been identified.

The risk of default is high. Among the negative credit factors, we point to weak positions in its industry, bleak profitability, negligible return on capital, poor working capital management, inadequate interest coverage, and poor cash flow generation. We note resilient historical revenue growth, low margin volatility, and an favourable capital structure, among the positive credit factors. 

In highly turbulent market conditions, DNN is moderately volatile. In other words, the stock will fall more than the index in times of extreme market volatility or shocking company news. Standalone, the worst-day losses (less than 1% of the time) will likely be moderate. 

In normal market circumstances, DNN is highly volatile. Put differently, without outstanding market volatility or shocking company news, the stock's price will change somewhat erratically. The stock's losses on its worst days (less than 1-5% of the time) will range from significant to immense. 

From both historical and forecast perspectives, the stock is considerably overpriced compared to similar stocks. 

Denison Mines Corp.

$ 1.7

3

Denison Mines Corp.

$ 1.7

3

Risk factor

Profitability factor

Risk / Profitability

About

About

Risk factor

Profitability factor

$ 1.7

About

About

Denison Mines Corp.

$ 1.7

3

Denison Mines Corp.

$ 1.7

3

Risk factor

Profitability factor

Risk / Profitability

About

About

Risk factor

Profitability factor

$ 1.7

About

About

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