It's time for Usec to give some guidance, uncertain as it may be, about 2013 and beyond.
There's no reason for management not to share its strategy for sustaining cash flows after they shutter the Paducah gaseous diffusion plant and until the successful (big assumption) ACP comes on line.
What you say? Usec is going to depend on the Russians to sustain it? Lemme think about that for a minute.
The clouds overhanging Usec are so thick that it seems like midnight all day, every day. They include the questions about the continuing availability of the DOE funds to continue the ACP RD&D project, the eventual success of ACP, operating income during the gap between Paducah and Piketon (see above), whether DOE will provide the loan guarantee for the ACP build-out, questions about the Company's ability to refinance of existing debt, the NYSE listing, the possible technological threat of SILEX, the overall market demand for nuclear power, etc.
Yikes! Did I forget anything?
That's why the shares are selling for 62 pennies.
And, yet, I'm long big time (for me, at least, meaning over 5% of my equity allocation). Why? Because the upside is huge if the the Company can find some sunshine.
Management could be more helpful along the way if they're be more pro-active with the outlook.
Yes you forgot the positive sides. The RDD is on plan and funded. ACP Machines have been running for about 5 years. ACP is on schedule. Infrastructure is built. Reactors are being built and fired back up. Energy consuption is up. Russia is suppose to supply USEC with LEU for USECS customers. World is getting hotter from greenhouse gases..(some debate on that) and USEC has 300m in cash. The other clean air sources, Wind mill and Solar fads are waning. Uranium prices appear to have bottomed.
On the negative you forgot about the Areva plans in Idaho and Urenco 2x expansion in New Mexico, no central storage for reactor waste, cash flow on a 2b debt might hurt profits.
I agree big upside potential. Might take 5 years though. It will come in leaps. RDD successful, LG funding, sales-demand up, profits up. Last one should put stock around $10.