Good morning and welcome to this week’s Flight Path. The “Go” trend in equities continued again this past week but we saw some weakness as GoNoGo trend painted a few weaker aqua bars. Treasury bond prices experienced a change in trend as a few bars of “Go Fish” gave way to a purple “NoGo” bar. U.S. commodities painted a full week of strong blue “Go” bars and the dollar also saw strength return with strong blue bars.
$SPY Shows a Little Weakness with Aqua Bars
The GoNoGo chart below shows that price has moved mostly sideways since the last high and the Go Countertrend Correction Icon (red arrow) that came with it. The waning momentum suggested that price may have a hard time moving higher in the short term. GoNoGo Trend has painted a few weaker aqua bars as well and we see GoNoGo Oscillator testing the zero line from above. It will need to find support here and if it does we will be able to say that momentum is resurgent in the direction of the “Go” trend.
On the longer term chart, the trend continues to be strong. However we are seeing the price range shrink as we edge higher. GoNoGo Oscillator is not in overbought territory and seems to be resting at a value of 3. We will watch to see if the oscillator falls to test the zero line perhaps in the next few weeks.
Treasury Rates Return to Paint “Go” Colors
Treasury bond yields reversed course and after consecutive amber “Go Fish” bars that often come as a transition between trends we see the indicator painting “Go” colors again. GoNoGo Oscillator has broken back into positive territory which confirms the trend change that we see in price above.
The Dollar Sees a Return to Strength
The dollar rallied this week with a string of uninterrupted bright blue “Go” bars. Price is approaching resistance from prior highs and we will watch to see if it can continue higher. GoNoGo Oscillator broke back into positive territory and we saw a Go Trend Continuation Icon (green circle) indicating that momentum is resurgent in the direction of the “Go” trend. We will watch to see if this will give price the push it needs to make a new high in the coming days and weeks.
Silver saw strong gains in 2024, breaching the US$32 mark in the first half of the year and then the US$34 mark in October.
Silver’s dual function as a monetary and industrial metal offers great upside. Demand from energy transition sectors, especially for its use in the production of solar panels, has created tight supply-and-demand forces.
Demand is already outpacing mine supply, making for a positive situation for silver-producing companies and their investors.
How has silver’s price movement benefited Canadian silver stocks on the TSX, TSXV and CSE? The five companies listed below have seen the best performances since the start of the year.
Data was gathered using TradingView’s stock screener on December 10, 2024, and all companies listed had market caps over C$10 million at that time.
Pantera Silver is a precious metals exploration and development company focused on its Nuevo Taxco silver-gold project located near Mexico City, Mexico.
The company signed an earn-in agreement with Impact Silver (TSX:IPT) for the 1,100 hectare property in October 2020. Though limited exploration has been carried out on the property, work done by Impact in 2013 identified 21 silver bearing veins. Of the 395 rock samples collected at that time, three contained grades of over 1,000 g/t silver. In its own drill program carried out in 2022, Pantera highlighted assay results of up to 225 g/t silver from 1.85 meters.
On October 20, Pantera provided a corporate update and was looking at various options to restart exploration work that had previously been paused at Nuevo Taxco. In the announcement, Pantera said it was expecting to begin work in Q3 2024 and would be focusing on sampling and mapping the Southwest Zone of the project. The company has not provided any further updates regarding exploration work at Nuevo Taxco.
The most recent news from Pantera came on December 3 when it announced it had entered into a definitive agreement to acquire a 100 percent stake in the Rakanco project. The property is composed of three mineral claims covering an area of 17,975 hectares in southwest Bolivia.
Shares in Pantera reached a year-to-date high of C$0.46 on October 22 alongside a surging silver price.
Gatos Silver is a silver-focused production and exploration company. Its flagship asset is the Cerro Los Gatos mine and district, located south of Chihuahua City, Mexico.
The site consists of 14 predominantly silver, lead and zinc mineralization zones, and is a joint venture with Dowa Metals and Mining, which holds a 30 percent stake in the operation; Gatos owns the remaining 70 percent.
On February 21, the company released its full-year results for 2023, indicating it had produced 9.2 million ounces of silver, marking a decline from the 10.3 million ounces produced in 2022. However, the company said it improved operational efficiencies to offset inflationary pressure, lowering all-in-sustaining costs (AISC) to the lower end of 2023 guidance.
In the release, Gatos also notes that it expects similar production totals for 2024, with guidance of 8.4 million to 9.2 million ounces of silver at an AISC of US$9.50 to US$11.50 per payable ounce. The company said it anticipates that exploration efforts at the South-East Deeps target will further extend the life of the mine.
On July 23, Gatos reported an update on regional exploration programs. Drilling at the South East Deeps zone extension resulted in a highlight of 214 g/t silver over 3.5 meters.
Additionally, results from its ongoing drilling at the Portigueño target included a highlight of 49 g/t silver over 1.6 meters, and results from two holes testing the depth of the San Luis target produced a highlighted intercept more than 150 meters below surface of 66 g/t silver over 8.9 meters, including 111 g/t silver over 2.5 meters.
On September 5, Gatos announced it had entered into a definitive merger agreement in which it will be acquired by First Majestic Silver (TSX:AG,NYSE:AG). Under the terms of the deal, Gatos shareholders will receive 2.44 common shares of First Majestic for each share of Gatos held at a price of US$13.49 based on the closing price of First Majestic on the NYSE on September 4, 2024. The transaction sets the total equity value of Gatos at US$970 million. The merger is expected to be completed in early 2025.
In a Q3 production update on October 9, Gatos reported its silver equivalent production in Q3 increased 11 percent year over year. Additionally, through the first nine months of 2024, Gatos produced 7.1 million ounces of silver, up from 6.65 million ounces in the same period in 2023.
The higher figures allowed the company to increase guidance for 2024 to 9.2 million to 9.7 million ounces of silver from its original guidance of 8.4 million to 9.2 million ounces.
In a follow-up on November 11, the company released its Q3 financial and operating results, which stated earnings per share had increased 200 percent to C$0.14 from C$0.05 and that net income had increased to C$9.9 million from C$3.3 million from the same period in 2023.
Shares in Gatos Silver reached a year-to-date high of C$27.85 on October 29.
GR Silver Mining is a small-cap explorer and developer that is working to advance its Rosario Mining District in Sinaloa, Mexico, to production. The district consists of three core mining areas: Plomosas, San Marcial and La Trinidad.
The company’s primary focus has been the development of Plomosas and neighboring San Marcial, a 9,764 hectare land package that hosts a past-producing silver, gold, lead and zinc underground mine.
In March 2023, the company released an updated resource estimate for Plomosas showing total indicated resources of 97 million silver equivalent ounces, with additional inferred resources of 53 million silver equivalent ounces.
Shares of GR Silver saw significant gains in the first quarter alongside a rising silver price and a March 4 announcement that GR started small bulk sampling and test mining at Plomosas.
The company provided results from the sampling program in an update on June 27. In the report, GR Silver said it had completed 280 meters of underground development and processed 15,170 metric tons of material. Silver recovery rates from the samples were between 84 and 92 percent. Assays from channel sampling produced high grades, with one sample grading 1,625 grams per metric ton (g/t) silver and 14.1 g/t gold over 2.5 meters.
On July 17, GR announced that it had completed its sale of Marlin Gold Mining to a private, arm’s-length company active in Mexico. Under the terms of the agreement, GR will receive a 0.5 percent net smelter royalty on the concessions owned by Marlin subsidiary Oro Gold and a 10-year first right of refusal on any disposition of the concessions.
Since then, the company has spent time fundraising. Its most recent news came on September 27, when GR announced it had closed an oversubscribed private placement for C$2.37 million. The company said it intends to use the proceeds toward exploration activities at its Plomosas project.
GR Silver’s share price reached a year-to-date high of C$0.295 on October 23.
Andean Precious Metals is a silver focused mining company with a pair of operating assets in the Amercias.
Its primary silver producing operation is the San Bartolome mine in the Potosi Department of Bolivia. The onsite processing facility has an annual ore capacity of 1.8 million metric tons. A September 2023 mineral reserve statement demonstrated proven and probable quantites of silver at 6.85 million ounces from 21.01 million metric tons of ore with an average grade of 10.15 g/t.
Its other producing asset is the Golden Queen mine in Kern County, California, United States. It hosts a 12,000 metric ton per day cyanide heap leach and Merril-Crowe processing facility. The mineral reserve statement shows measured and indicated silver values at 11.24 million ounces from 41.81 million metric tons with an average grade of 8.37 g/t.
The company acquired Golden Queen from Auvergne Umbrella in November 2023 for total considerations of US$15 million.
On November 11, the company released its third-quarter 2024 operating and financial results. In the report, the company stated that during the first nine months of the year, it had produced 2.98 million ounces of silver at San Bartolomé, an 11 percent reduction from 2023. However, this was offset by production at Golden Queen, which generated 395,000 ounces of silver.
The most recent news from Andean came on December 5, when it announced it had received approval to be listed on the Toronto Stock Exchange (INDEXTSI:OSPTX). The company says the move reflects its commitment to delivering shareholder value and will enhance Andean’s visibility and ability to broaden its investor base.
Andean shares have positive momentum all year but saw their biggest increase alongside a surge in silver and gold prices in September and into October. It reached its year-to-date high of C$2.10 on October 22, the same day Silver saw its highest price of the year.
Endeavour Silver is a silver company with two operating silver-gold mines in Mexico — Guanaceví and Bolañitos — plus the advanced-stage Terronera development project and several exploration properties.
Its primary focus for 2024 has been its Terronera project in Jalisco, Mexico, which is under construction. Once complete, the new mine will become the company’s flagship operation. According to a 2023 update to its 2021 feasibility report, Terronera will produce an estimated 4 million ounces of silver per year over a 10 year mine life.
On July 24, Endeavour announced that construction at the site had progressed, with surface construction achieving 77 percent completion. The company said it should be ready for dry commissioning during Q3 2024 and that final earthworks and concrete pouring were also expected to take place during the third quarter.
Endeavour reported on August 19 that, following a failure that occurred at the primary ball mill trunnion on August 12, it had resumed processing at its Guanacevi mine site. However, the company noted that its processing capacity would be halved during a ramp up with temporary modifications. At the time, it stated that permanent repairs to return to regular capacity should take 16 weeks for fabrication and installation.
The company estimated that silver production for the year would be 900,000 to 1.1 million ounces lower than previous guidance due to this.
In Endeavour’s Q3 production results released on October 8, the company said the failure and temporary fix had reduced throughput at the mill to 565 metric tons per day, resulting in production of 847,717 ounces of silver, a decrease of 24 percent compared to Q3 2023. For the first nine months of the year, Endeavour produced 3.65 million ounces of silver, 15 percent lower year-over-year.
Endeavour expects Guanacevi to be back to full operations in December.
In a release on October 21, Endeavour provided a construction update from Terronera indicating that it reached 77 percent completion. The company said it is on track to begin commissioning near the end of Q4.
Shares of Endeavour reached a year-to-date high of C$7.62 on October 29.
Securities Disclosure: I, Dean Belder, hold no direct investment interest in any company mentioned in this article.
While he sees further upside potential until about the end of January, ultimately he expects gold to move sideways or lower for multiple months before starting another big rally that will last four to six years.
‘That’s when the miners are really going to participate, and we’re going to see that everyone’s going to want to be involved in the precious metals mining space. They’re going to do those hundreds or thousands of percent returns when gold blasts off in this new economic reset,’ Vermeulen explained during the interview.
He also discussed his silver and platinum outlook, and shared why he recently decided to trade Bitcoin for the first time in 10 years. Vermeulen’s short-term target in this ‘can’t miss’ trade is US$108,700.
Watch the interview above for his full thoughts on those and other topics.
Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
Bitcoin hit a new record high of US$107,554 on December 16 following growing interest in Bitcoin as a potential reserve asset.
The speculations were spurred by a statement from US President-elect Donald Trump about creating a strategic reserve for cryptocurrencies.
“We’re going to do something great with crypto because we don’t want China or anybody else — not just China but others —embracing it ahead of us,” Trump said in a CNBC interview on December 12.
He further emphasized his administration’s intention to explore a Bitcoin reserve to strengthen the US position in the global cryptocurrency landscape.
The prospect of Bitcoin gaining reserve asset status has fueled institutional interest in the digital currency. Data from CoinShares showed that digital asset investment products saw US$3.2 billion in inflows last week, marking 10 consecutive weeks of gains.
Bitcoin products, including exchange-traded funds (ETFs), accounted for US$2 billion of these inflows, while Ethereum investment products attracted US$1 billion.
According to CoinShares, global Bitcoin ETFs now manage over US$135 billion in assets, reflecting heightened institutional adoption.
Market observers and analysts have presented mixed projections for Bitcoin’s future following the statements.
Arthur Hayes, co-founder of BitMEX, told Forbes that Bitcoin could reach prices between “hundreds of thousands to US$1 million” if it secures formal reserve status.
Bernstein analysts forecast Bitcoin reaching US$500,000 by 2029 and US$1 million by 2033, driven by the adoption of regulated Bitcoin ETFs.
However, skeptics argue that Bitcoin’s volatility and lack of stability compared to traditional reserves like gold or government bonds remain significant barriers.
Chris Weston, head of research at Pepperstone, cautioned against overly optimistic expectations, stating that implementing a strategic Bitcoin reserve would require strategic planning and communication.
‘I think we still need to be cautious on a BTC strategic reserve, and at least consider that this is not likely to happen anytime soon,’ Weston told Reuters.
Worldwide, governments have started accumulating Bitcoin as part of their reserve strategies.
As of July, global governments held 2.2 percent of Bitcoin’s total supply, with the United States owning nearly 200,000 Bitcoin worth over US$20 billion. Other significant holders include China, the UK, Bhutan and El Salvador.
Russian President Vladimir Putin has pointed to cryptocurrencies as an alternative reserve asset amid declining confidence in the US dollar, stating that Bitcoin ‘cannot be prohibited by anyone.’
Since the US election on November 5, Bitcoin’s price has gained more than 50 percent, with the cryptocurrency’s total market capitalization nearing US$3.8 trillion.
Trump’s pro-crypto stance during his campaign and subsequent announcements have contributed to growing confidence in the sector.
The President-elect recently named David Sacks, a former PayPal (NASDAQ:PYPL) executive, as White House czar for artificial intelligence and cryptocurrencies.
Additionally, pro-crypto Washington attorney Paul Atkins is expected to lead the Securities and Exchange Commission under Trump’s administration.
Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.
The uranium market saw a flurry of activity in 2024, from setting 17 year highs to seeing an additional six countries join the original 25 countries committing to tripling nuclear power by 2050 at COP29.
The energy fuel also played a prominent role in the US tech sector’s clean energy ambitions, while also being impacted by geopolitical tensions between the US and Russia.
The 2024 uranium market also benefited from growing concern over future supply. As demand is poised to grow globally the mounting supply imbalance began to become clear in the usually opaque market.
As prices remained in historically high territory through the year majors and developers began looking for deals punctuating 2024 with some major mergers and acquisitions.
While many factors added to uranium’s 2024 story, price performance, geopolitical risk, energy transition and future supply were among the most impactful.
Record price highs
Continuing the momentum of 2023 — which saw prices rise 86 percent between January and the end of December — U3O8 spot prices started 2024 at the US$91 per pound level.
The upward trajectory was further fueled by news that uranium mining major Kazatomprom (LSE:KAP,OTC Pink:NATKY) was facing sulphuric acid shortages, a key component of its uranium extraction and production process.
By February 5, prices had risen to US$105.91, marking a nearly two decade high.
The inability to source the acid prompted the Kazakhstan-based major to revise its annual production guidance.
“Supply side fragility continued to be one of the key themes in Q1, especially the news out of Kazakhstan that production would be significantly lower than expected in 2024 than previously thought,” Ben Finegold, associate at Ocean Wall, a London-based investment house said in a Q1 review email.
Kazatomprom’s adjusted 2024 uranium production guidance was projected to range between 21,000 and 22,500 tonnes on a 100 percent basis, and 10,900 to 11,900 tonnes on an attributable basis.
While in line with the output of previous years, the company had to place plans for a production ramp up on the back burner due to the acid shortage and development issues.
“The sulphuric acid issue in Kazakhstan is a systemic problem that we do not believe will go away any time soon,” Finegold added.
Despite the supply side issues, prices were unable to find support at the US$105 level and retracted to US$85 by mid-March.
Prices continued to consolidate through the year and found support around the US$76 per pound level. Although the contraction prompted the energy fuel to shed 27 percent from its January high, the spot U3O8 price remains in historically high territory.
Geopolitical risk
Production challenges out of Kazakhstan in Q1 set the stage for other supply and demand issues in the year. By May The ongoing war in Ukraine intensified discussions around imposing restrictions on Russian uranium imports.
Russia has been a key player in global uranium enrichment, and potential sanctions raised concerns about supply chain disruptions, especially for countries like the U.S. that source uranium from Russia.
As tensions ratcheted up President Biden chose to place a ban on Russian uranium imports in mid-May.
“This new law reestablishes America’s leadership in the nuclear sector. It will help secure our energy sector for generations to come. And — building off the unprecedented US$2.72 billion in federal funding that Congress recently appropriated at the President’s request—it will jumpstart new enrichment capacity in the United States and send a clear message to industry that we are committed to long-term growth in our nuclear sector,” said National Security Advisor Jake Sullivan.
The US has historically relied on Russian uranium, notably through the 1993 Megatons to Megawatts program, which repurposed 500 metric tons of Russian nuclear warhead uranium into reactor fuel.
In 2022, Russian imports still made up 12 percent of the US uranium supply, according to the Energy Information Administration. This dependency highlights a longstanding reliance on Russian materials for domestic energy needs.
While the US works to bolster its domestic uranium production the country will likely look to Canada and Australia to meet its enormous energy needs.
Niger, the seventh largest uranium producing country, also faced geopolitical strife when a military coup upended the country’s uranium sector adding substantial uncertainty in uranium markets.
European utilities, heavily reliant on Nigerien uranium, faced heightened risks, underscoring the vulnerability of supply chains linked to politically unstable regions.
The instability also impacted uranium miners and juniors operating in the region.
In June, French nuclear firm Orano lost its mining permit for Niger’s massive Imouraren uranium deposit, which holds over 174,000 tons of reserves.
While the site’s development was paused in 2015 due to low uranium prices, Niger demanded action as prices surged, warning Orano to begin work by June 19.
Despite submitting a proposal and reopening site infrastructure, Niger revoked the permit, with analysts linking the decision to shift political dynamics following the July 2023 coup.
In mid-July, uranium exploration company GoviEx Uranium (TSXV:GXU,OTCQB:GVXXF) had the military government revoke its rights to the perimeter of the Madaouela mining permit, placing it in the public domain.
In response to the permit withdrawal GoviEx Uranium has initiated arbitration proceedings against the Republic of Niger over the disputed Madaouela uranium project permits.
In a December 9 statement, the company alleged that Niger failed to meet its obligations under the project’s mining agreement, jeopardizing the development of one of Africa’s most significant uranium assets.
GoviEx and its subsidiaries are seeking a resolution through international arbitration, emphasizing the importance of contractual stability in the global uranium industry.
In late November, geopolitical tensions began mounting between the US and Canada as President-elect Donald Trump threatened to levy a 25 percent tariff on services and goods from neighboring countries and USMCA member states Canada and Mexico.
Canadian Prime Minister Justin Trudeau and Ontario Premier Doug Ford quickly responded to the tariff threat underscoring the interconnectedness of both economies, as well as the integrated energy trade between the countries.
According to the US Energy Information Administration (EIA), in 2022 the US purchased 40.5 million pounds of U3O8. Canada was the largest contributor providing 27 percent of the country’s supply.
Fortifying relationships with ally and neighbor states like Canada could prove crucial amid the US ban on Russian uranium imports. If the ban expands to Russian allies, supply from Kazakhstan and Uzbekistan -countries that contributed 25 percent and 11 percent to US supply- could also become precarious.
As pundits debated the potential impact of a tit-for-tat tariff tussle, sector participants forged ahead with deals.
Notably in early December NexGen Energy (TSX:NXE,NYSE:NXE,ASX:NXG) secured its first uranium sales contracts with major US utilities, totaling 5 million pounds.
The agreements cover an initial five-year period, marking a significant milestone as NexGen advances its Rook I project in Saskatchewan, home to the high-grade Arrow uranium deposit.
NexGen Chief Executive Leigh Curyer explained that the agreements marked a key milestone and highlighted the exceptional quality and scalability of its Rook I Project. The newly penned contracts also diversify uranium supply and align with market-based pricing strategies.
“Energy demand from reliable sources is increasing by the week with the need to expand existing nuclear energy infrastructure and the construction of power consuming data centres at a time the security of uranium supply is under significant technical and sovereign risk,” said Curyer.
Tech sector’s energy demands
Aside from high prices, energy security and geopolitical risk powering AI data centers emerged as a key driver in the 2024 uranium market.
According to data from Brightlio, an IT service provider, there are more than 8,000 data centers around the globe, accounting for 4 percent of total energy consumption and 1 percent of global greenhouse gas emissions.
Data center capacity is projected to triple by 2030, making the long term energy demands of the sector immense. It is estimated that one ChatGPT request could power a lightbulb for 20 minutes.
As the energy demands of AI surged, governments and companies turned to nuclear power to ensure a reliable, carbon-free energy supply, and nuclear supply deals began to emerge.
At the end of Q3 Constellation Energy (NASDAQ:CEG) revealed plans to revive the shuttered Three Mile Island Unit 1. The restart is part of a 20 year power purchase agreement with Microsoft (NASDAQ:MSFT).
The supply deal is expected to deliver 835 megawatts of clean energy to the grid, add over US$3 billion in taxes and US$16 billion for Pennsylvania’s economy.
A few weeks later, Amazon (NASDAQ:AMZN) subsidiary Amazon Web Services (AWS) unveiled plans to invest in small modular reactor development. The innovative nuclear technology will be used to power AWS’ data centers.
Under the investment decision AWS will spend US$500 between both Dominion Energy (NYSE:D) and Energy Northwest to advance the innovative nuclear technology. AWS plans to use small modular reactors to power its data centers.
In mid-October, Google (NASDAQ:GOOGL) penned an agreement to purchase power from multiple SMRs that will be developed by Kairos Power. The deal will supply up to 500 megawatts of carbon-free electricity to US grids, aiming to support the rising energy demand driven by AI.
Global data center power consumption is forecast to nearly double from 460 terawatt hours in 2022 to over 800 terawatt hours by 2026. As demand from the tech sector expands, concerns over supply deficits have only intensified.
This supply and demand imbalance was highlighted during the November Annual General Meeting address from Australian uranium company Paladin (ASX:PDN,OTCQX:PALAF).
“With limited investment in new uranium mines, there is a growing supply deficit that is anticipated to increase to over 50 million pounds per annum during the next decade,” said Cliff Lawrenson, non-executive chairman.
“Diversity of supply is also becoming increasingly important as a response to recent geopolitical activities, including the recent US ban on Russian supplies.”
While all the above mentioned themes will continue to impact the uranium market, increased M&A activity is another emerging trend that is likely to play prominently in the year ahead.
Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.
Starting the year strong and setting a 17 year high of US$106 per pound the spot U3O8 market displayed another year performance in early January, the uranium spot price has spent the rest of the year consolidating, remaining rangebound between US$76 and US$86 since mid-June.
Although prices faced consolidating headwinds during the second half of 2024, prices remained at historically high levels not seen since 2008. As prices found a floor in the US$76 range, the long-term uranium market outlook illuminated supported by several key events.
Production challenges related to acid shortages and expansion delays out of top producing nation – Kazakhstan – sparked concern about supply shortages early in the year.
The supply deficit threat was further heightened for the US when President Biden banned Russian uranium imports. The embargo, a result of the ongoing war in Ukraine, could remove 12 percent or more from America’s annual uranium supply.Geopolitical instability was also a factor in Niger, as the military government installed after a 2023 coup revoked permits for Orano and GoviEx uranium projects.
Data centers and the energy to power them also emerged as a prevalent theme in the 2024 uranium as major tech companies scramble to secure long term, clean energy supply agreements.
At the end of the year, the market got more structural support as six more countries joined the 25 nations that committed to tripling nuclear power supply by 2050 at COP28.
Making the announcement at COP29, Dr Sama Bilbao y León, Director General, of the World Nuclear Association said:
“Nuclear can now count on the world’s biggest banks to back the growth of the nuclear industry. Nuclear has attracted the interest and investment of the world’s largest and most advanced technology companies. And nuclear has ever-increasing support from the public, who recognize that in nuclear they have an answer to their demands for energy security, reliable supply and prices, and a response to climate change.”
Below are the best-performing Canadian uranium stocks by share price performance so far this year. All data was obtained on December 13, 2024, using TradingView’s stock screener, and all companies had market caps above C$10 million at the time. Companies on the TSX, TSXV and CSE were considered, but no TSX stocks made the list this time.
Read on to learn what factors have been moving their share prices.
CanAlaska Uranium is a self-described project generator with a portfolio of assets in the Saskatchewan-based Athabasca Basin. The region is well known in the sector for its high-grade deposits.
The company’s portfolio includes the West McArthur property, which is situated near sector major Cameco (TSX:CCO,NYSE:CCJ) and Orano Canada’s McArthur River/Key Lake mine joint venture. In 2018, Cameco signed on as a joint venture partner for CanAlaska’s West McArthur project, and it retains a 16.65 percent stake.
In mid-April, CanAlaska acquired the Intrepid East and Intrepid West projects in the Northeastern Athabasca Basin. The two projects cover a combined 58,747 hectares and are 20 kilometers north of the high-grade Hurricane uranium deposit.
During the second quarter, CanAlaksa conducted airborne surveys at its projects near Cameco and Orano’s Key Lake mill — the Key Extension, Enterprise, Voyager and Nebula projects — as well as at its Frontier project.
In July, a summer drill program at West McArthur’s Pike zone made two significant intersections.
On July 9, hole WMA082-7 intersected 3.44 percent equivalent U3O8 (eU3O8) over 21.6 meters, including 10.9 percent eU3O8 over 5.4 meters. Then, on July 16, CanAlaska reported that hole WMA082-8 had intersected 6.87 percent eU3O8 over 16.9 meters, including 11.62 percent eU3O8 over 9.3 meters.
In mid-September, CanAlaska raised C$5 million through a non-brokered private placement.
Canada-focused Greenridge Exploration is engaged in the exploration of the Nut Lake uranium project in the Thelon Basin in Nunavut, Canada, and has acquired several uranium projects this year.
According to the company, Nut Lake is strategically positioned near the Angilak uranium deposit, which was recently acquired by Atha Energy (TSXV:SASK,OTCQB:SASKF) as part of a three way merger with Latitude Uranium and 92 Energy.
Nut Lake is a new property for Greenridge. On January 18, the company entered into an option agreement with three parties to acquire a 100 percent stake in the asset. Historic drilling at the polymetallic deposit has identified “significant” uranium mineralization, with intersections of up to 9 feet containing 0.69 percent U3O8.
Nut Lake isn’t Greenridge’s only addition this year. In May, the company acquired the Carpenter Lake uranium project, which covers 13,387 hectares near the Athabasca Basin’s southern margin. Greenridge ended the quarter by acquiring the Snook Lake and Ranger Lake uranium projects in Ontario. The Ranger Lake project covers 20,782 hectares in the Elliot Lake region, while the Snook Lake project spans 4,899 hectares in Northwestern Ontario.
In mid-August, the company released an updated technical review for Nut Lake. For the new review, Greenridge focused on gathering and analyzing historical data for the project, including digitizing drill hole information, georeferencing maps and extracting data from historical reports related to the Nut Lake property.
Shortly after, Greenridge announced plans to acquire Canadian uranium company ALX Resources (TSXV:AL,OTC Pink:ALXEF). The merger will create a major Canadian uranium exploration company with 15 projects across 276,000 hectares in key uranium districts, along with interests in 13 other resource properties.
District Metals is an energy metals and polymetallic explorer and developer with a portfolio of nine assets, including five uranium projects in Sweden. It’s currently focused on its Viken property, which hosts a uranium-vanadium deposit.
Historic estimates conducted in 2010 and 2014 peg the indicated resource at 43 million metric tons with an average grade 0.019 percent U3O8, with another 3 billion metric tons with an average grade 0.017 percent U3O8 in the inferred category. According to the company, Viken is one of the “world’s largest in terms of uranium and vanadium mineral resources.’
Shares of District spiked to a year-to-date high of C$0.49 on May 21. The jump coincided with the company announcing that its subsidiary, Bergslagen Metals, had received final approvals for its mineral license applications in Jämtlands and Västerbottens Counties in Sweden to explore for metals including vanadium, nickel, molybdenum and rare earths.
“We are very pleased with the timely approvals for our eight mineral license applications that cover a total of 91,470 hectares of ground that is highly prospective for Alum Shale deposit targets,” said Garrett Ainsworth, CEO of District. “Alum shales are the host rocks of our Viken Energy Metals Deposit, which represents a potentially significant source of critical and strategic metals and minerals for the green energy transition.”
Myriad Uranium is an exploration company with a 75 percent earnable interest in the 1,911 acre Copper Mountain uranium project in Wyoming, US. The property holds several known uranium deposits and historic mines, including the past-producing Arrowhead mine, which previously produced 500,000 pounds of eU3O8.
The company also holds a 50 percent interest in the Millen Mountain property in Nova Scotia, Canada, alongside Probe Metals (TSX:PRB,OTCQB:PROBF), as well as an 80 percent interest in uranium exploration licenses in Niger.
Focusing on its Copper Mountain asset, Myriad conducted a geophysical survey targeting the Canning deposit in July. The goal of the survey was to update the resource potential and lay the early groundwork for further exploration.
That was followed by a magnetometer survey in September, an important precursor to a maiden exploration drill program and subsequent maiden mineral resource estimate, slated for completion by the end of Q1 2025.
As Myriad worked to advance its US asset, the company announced it was exiting Niger. In a July 23 statement it said that it would immediately ‘quit or relinquish, as appropriate,’ any interests in the country.
CEO Thomas Lamb explained the decision to leave the African country.
“Myriad has been prevented by reasons beyond its control from conducting operations in Niger since the July 2023 coup d’etat,” he said. “We are now focusing all our attention on the Copper Mountain uranium project in Wyoming, USA., a project with significant past production, a large historical uranium resource, and exciting exploration upside.”
Premier American Uranium is engaged in consolidating, exploring and developing uranium projects across the US.
The company holds large land packages in two major uranium-producing areas: Wyoming’s Great Divide Basin and Colorado’s Uravan Mineral Belt. Additionally, Premier took over control of the advanced Cebolleta uranium exploration project in New Mexico when it acquired American Future Fuel in June of this year.
Other highlights from the first nine months of 2024 include the closing of a C$5.77 million private placement in May, and the commencement of an inaugural drill program at the Cyclone in-situ recovery uranium project in Wyoming.
FAQs for investing in uranium
What is uranium used for?
Uranium is primarily used for the production of nuclear energy, a form of clean energy created in nuclear power plants. In fact, 99 percent of uranium is used for this purpose. As of 2022, there were 439 active nuclear reactors, as per the International Atomic Energy Agency. Last year, 8 percent of US power came from nuclear energy.
The commodity is also used in the defense industry as a component of nuclear weaponry, among other uses. However, there are safeguards in effect to keep this to a minimum. To create weapons-grade uranium, the material has to be enriched significantly — above 90 percent — to the point that to achieve just 5.6 kilograms of weapons-grade uranium, it would require 1 metric ton of uranium pre-enrichment.
Because of this necessity, uranium enrichment facilities are closely monitored under international agreements. Uranium used for nuclear power production only needs to be enriched to 5 percent; nuclear enrichment facilities need special licenses to enrich above that point for uses such as research at 20 percent enrichment.
The metal is also used in the medical field for applications such as transmission electron microscopy. Before uranium was discovered to be radioactive, it was used to impart a yellow color to ceramic glazes and glass.
Where is uranium found?
The country with the greatest uranium reserves by far is Australia — the island nation holds 28 percent of the world’s uranium reserves. Rounding out the top three are Kazakhstan with 15 percent and Canada with 9 percent.
Although Australia has the highest reserves, it holds uranium as a low priority and is only fourth overall for production. All its uranium output is exported, with none used for domestic nuclear energy production.
Kazakhstan is the world’s largest producer of the metal, with production of 21,227 metric tons in 2022. The country’s national uranium company, Kazatomprom, is the world’s largest producer.
Canada’s uranium reserves are found primarily in its Athabasca Basin, and the region is a top producer of the metal as well.
Why should I buy uranium stocks?
Investors should always do their own due diligence when looking at any commodity so that they can decide whether it fits into their investment plans. With that being said, many experts are convinced that uranium has entered into a significant bull market, meaning that uranium stocks could be a good buy.
A slew of factors have led to this bull market. While the uranium industry spent the last decade or so in a downturn following the 2011 Fukushima nuclear disaster, discourse has been building around the metal’s use as a source of clean energy, which is important for countries looking to reach climate goals. Nations are now prioritizing a mix of clean energies such as solar and wind energy alongside nuclear. Significantly, in August 2022, Japan announced it is looking into restarting its idled nuclear power plants and commissioning new ones.
Uranium prices are very important to uranium miners, as in recent years levels have not been high enough for production to be economic. However, in 2024, prices spiked from the US$58 in August 2023 to a high of US$106 per pound U3O8 in February 2024. They have since consolidated at around US$85, meaning this could be a buying point for those looking to get into the sector.
Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.
Stock futures are trading slightly lower Monday morning as investors gear up for the final month of 2024. S&P 500 futures slipped 0.18%, alongside declines in Dow Jones Industrial Average futures and Nasdaq 100 futures, which dropped 0.13% and 0.17%, respectively. The market’s focus is shifting to upcoming economic data, particularly reports on manufacturing and construction spending, ahead of this week’s key labor data releases.
November was a standout month for equities, with the S&P 500 futures rallying to reflect the index’s best monthly performance of the year. Both the S&P 500 and Dow Jones Industrial Average achieved all-time highs during Friday’s shortened trading session, with the Dow briefly surpassing 45,000. Small-cap stocks also saw robust gains, with the Russell 2000 index surging over 10% in November, buoyed by optimism around potential tax cuts.
As trading kicks off in December, investors are keeping a close eye on geopolitical developments in Europe, where France’s CAC 40 index dropped 0.77% amid political concerns, while Germany’s DAX and the U.K.’s FTSE 100 showed smaller declines.
S&P 500 futures will likely continue to act as a key barometer for market sentiment, particularly as traders assess the impact of upcoming economic data and global market developments.
S&P 500 Index Chart Analysis
This 15-minute chart of the S&P 500 Index shows a recent trend where the index attempted to break above the resistance level near 6,044.17 but retraced slightly to close at 6,032.39, reflecting a minor decline of 0.03% in the session. The candlestick pattern indicates some indecisiveness after a steady upward momentum seen earlier in the day.
On the RSI (Relative Strength Index) indicator, the value sits at 62.07, having declined from the overbought zone above 70 earlier. This suggests that the bullish momentum might be cooling off, and traders could anticipate a short-term consolidation or slight pullback. However, with RSI above 50, the overall trend remains positive, favoring buyers.
The index’s recent low of 5,944.36 marks a key support level, while the high at 6,044.17 could act as resistance. If the price sustains above the 6,020 level and RSI stabilizes without breaking below 50, the index could attempt another rally. Conversely, a drop below 6,020 could indicate a bearish shift.
In conclusion, the index displays potential for continued gains, but traders should watch RSI levels and price action near the support and resistance zones for confirmation.
Stock futures climbed on Wednesday, driven by strong performances from Salesforce and Marvell Technology, following upbeat quarterly earnings. Futures tied to the Dow Jones Industrial Average rose by 215 points (0.5%), while S&P 500 futures gained 0.3%, and Nasdaq-100 futures advanced by 0.7%.
Salesforce surged 12% after reporting fiscal third-quarter revenue that exceeded expectations, showcasing robust demand in the enterprise software sector. Meanwhile, chipmaker Marvell jumped 14% after surpassing earnings estimates and providing optimistic fourth-quarter guidance, indicating resilience in the semiconductor industry.
This movement follows a mixed session on Wall Street, where the S&P 500 and Nasdaq closed with small gains, while the Dow dipped slightly. The broader market has experienced a modest start to December, contrasting with November’s robust rally, but analysts anticipate a resurgence in momentum. LPL Financial’s George Smith pointed out that December historically sees strong market performance, particularly in the latter half of the month.
However, economic data introduced some caution. ADP’s report revealed that private payrolls grew by just 146,000 in November, missing estimates of 163,000. This signals potential softness in the labor market, with investors now awaiting Friday’s November jobs report for further clarity.
S&P 500 Index Chart Analysis
Based on the provided stock chart, which appears to be a 15-minute candlestick chart for the S&P 500 Index, here’s a brief analysis:
The chart shows a clear upward trend, with higher highs and higher lows indicating bullish momentum over the analyzed period. The index has steadily climbed from a low of approximately 5,855 to a recent high of 6,053.58, suggesting strong buying interest.
Key resistance is observed near 6,050-6,053 levels, as the price has struggled to break above this zone in the most recent sessions. If the index breaches this level with strong volume, it could lead to further upward movement. Conversely, failure to break out may lead to a pullback, with potential support around the 6,000 psychological level and 5,980, where consolidation occurred previously.
The candlestick patterns show relatively small wicks, indicating limited volatility, which could imply steady market confidence. However, the bullish rally could be overextended, warranting caution for traders, especially if any negative catalysts emerge.
In summary, the short-term trend is bullish, but traders should monitor resistance levels and volume for signs of a breakout or reversal. It’s also essential to watch broader market factors, as indices are often influenced by macroeconomic data and sentiment.
McKinsey & Company agreed to pay $650 million in a deferred prosecution agreement that will resolve a federal criminal probe into the company’s consulting work advising Purdue Pharma on how to increase sales of its opioid painkiller OxyContin, a court filing said Friday.
A former top partner at McKinsey, Martin Elling, also agreed to plead guilty to obstruction of justice next month in the probe by the U.S. Department of Justice, according to a filing in U.S. District Court in Abingdon, Virginia.
The criminal charging document that McKinsey agreed to have filed by prosecutors alleges the consulting giant “knowingly and intentionally” conspired with Purdue Pharma “and others to aid and abet the misbranding of prescription drugs.”
The document also said McKinsey is accused, through the acts of its then-partner Elling, of “knowingly destroying and concealing records and documents with the intent” to impede the investigation by the Department of Justice.
McKinsey, which previously agreed to pay almost $1 billion to settle lawsuits by states, local governments and others related to its opioid consulting, accepted responsibility for the conduct alleged by federal prosecutors, according to the deferred prosecution agreement.
As part of the deal, McKinsey will not work on any marketing, sale, promotion or distribution of controlled substances.
In a statement to CNBC, McKinsey said, “We are deeply sorry for our past client service to Purdue Pharma and the actions of a former partner who deleted documents related to his work for that client.”
“We should have appreciated the harm opioids were causing in our society and we should not have undertaken sales and marketing work for Purdue Pharma,” the firm said. “This terrible public health crisis and our past work for opioid manufacturers will always be a source of profound regret for our firm has requested comment from McKinsey.”
The company said that in addition to its deferred prosecution agreement with the DOJ, it “has agreed to settle a related civil False Claims Act investigation and to enter into a Corporate Integrity Agreement with the Office of Inspector General at the Department of Health and Human Services.”
A rocky year for restaurants separated the industry’s biggest chains into winners and losers, as eateries competed for a smaller pool of customers who have grown more discerning about how they spend their dollars.
“I’ve been eating out less this year — it tastes just as good, and it’s way cheaper,” said Jennifer Jennings, who works in sales in Tulsa, Oklahoma.
Prices for food away from home had risen 3.6% over the last 12 months as of November, according to the Labor Department’s consumer price index. Grocery prices climbed just 1.6% during the same time, making cooking at home more attractive than dining out.
In response, many consumers have cut their restaurant spending, leading to slower sales and greater competition. The value wars reignited this summer. Chains took aim at their rivals in marketing and social media posts. And restaurants ramped up innovation, hoping that new menu items could boost sluggish traffic trends.
“I think the common thread behind everything right now is that the chains that are winning aren’t standing still. They’re doing something innovative, whether that’s new menu items … maybe that’s a marketing innovation … maybe it’s just hyper-emphasizing value,” said RJ Hottovy, head of analytical research for Placer.ai.
The year started off slow, with declining year-over-year traffic in January and February, before visits picked up again in March, according to industry tracker Black Box Intelligence. But eateries struggled again over the summer as consumers tightened their belts. Even a slew of value meals that promised cheap burgers and fries couldn’t stem the tide.
As traffic has fallen, bankruptcy filings have soared. Twenty-six bars and restaurants have filed for Chapter 11 this year, just one shy of tripling 2020′s total during the pandemic, according to the Debtwire Restructuring Database. This year’s filers included big names like Red Lobster and TGI Fridays.
While traffic has improved into the fourth quarter, some industry experts say it’s too early to predict a full recovery. A Numerator survey of more than 2,000 consumers found that the majority — across all income groups — plan to maintain their current spending levels at limited-service restaurants in the coming months.
But the chains that are already winning have seen their gains grow in the fourth quarter, further fueling their success.
Here are the winners and losers of the restaurant industry in 2024:
Value became restaurant CEOs’ new favorite word this year as they sought to reverse falling sales and appeal to inflation-weary consumers.
McDonald’s rang the alarm for the industry in late April, warning that consumers have become more “discriminating.” Three months later, the company’s second-quarter sales missed estimates and foot traffic to its U.S. restaurants shrank. The burger giant responded by rolling out a $5 combo meal, and many of its rivals followed suit with their own discounts and deals.
Traffic tied to value menu deals climbed 9% through October compared with the year-ago period, according to Circana data.
But value meals alone won’t save the industry.
For one, the lift from the deals isn’t enough to offset overalltraffic declines, according to David Portalatin, Circana senior vice president and industry advisor for food and food service.
Plus, “value” has come to mean more than just the price tag. It also includes the experience and quality.
“For the low-income consumer, it’s the dollar amount that matters. For everybody else, it’s value. Even if you have money, you’re noticing things are more expensive, and you’re going to be more selective,” Michael Zuccaro, Moody’s Ratings vice president of corporate finance, told CNBC.
Fast-food restaurants have been losing customers this year, as customers pull back their spending.
Despite a proliferation of $5 combo meals, traffic to quick-service restaurants fell almost 2% this year through October, according to Circana data. That’s bad news for the industry because fast food accounts for nearly two-thirds of overall restaurant visits.
Industry experts attribute the decline in fast-food traffic largely to low-income customers. Diners who make less than $40,000 account for more than a quarter of both McDonald’s and Taco Bell’s customer bases, based on Numerator data.
Many of those consumers have chosen to spend less at fast-food restaurants, whether it’s skipping the order of French fries or forgoing a visit altogether to cook at home.
“There’s a lot more competition with grocery and other food retailers,” Hottovy said. “That’s where most of the competition is, particularly for that lower- to middle-income consumer.”
The fast-food chains performing the best right now, like Yum Brands’ Taco Bell, have high value perception.
Typically, when consumers tighten their belts in an economic downturn or recession, fast-food restaurants benefit. Even as low-income consumers cut back, higher-income consumers trade down to fast-food combo meals. But that hasn’t happened this time as consumers who make more money have instead embraced a more holistic definition of value to decide where to spend their money. Those diners want a high-quality, satisfying meal more than they care about a deal.
The fast-food chains that performed the best in 2024 tended to focus on chicken: Chick-fil-A, Raising Cane’s andWingstop.
Chicken prices have stayed relatively stable this year, while beef prices have climbed. Poultry also benefits because some consumers consider it a more healthy option than red meat, even when the chicken is breaded and fried.
Chicken has been gaining market share from beef since the chicken sandwich wars of 2019, and restaurants have been leaning into the shift in consumer behavior. McDonald’s, for example, recently added the Chicken Big Mac to its U.S. menu permanently.
Upstarts like Raising Cane’s have also been making a splash. The privately held chain, known for its chicken tenders, is the fourth-largest chicken chain in the U.S., with a market share of 7.8%, according to Barclays. The chain could soon overtake KFC, the rare chicken chain that’s struggled to resonate with U.S. consumers this year.
KFC, which is owned by Yum Brands, has fallen behind in recent years as competition has intensified. Rivals like Chick-fil-A and Popeyes have stolen market share with buzzy menu items and the consumer shift toward boneless chicken.
Those chicken chains are stealing market share from burgers. McDonald’s, Wendy’s and Restaurant Brands International’s Burger Kingall had lackluster years.
McDonald’s has long dominated the burger category, with 48.8% market share, according to Barclays. But the chain saw its grip slip earlier this year as it scared off low-income consumers with its menu prices. However, by October, things were looking up for the Golden Arches: its $5 value meal was winning back customers, and its pricier Chicken Big Mac was boosting traffic.
Then came a fatal E. Coli outbreak linked to the slivered onions used in its Quarter Pounders. While the company acted quickly to contain the fallout, sales tumbled, especially in the affected states. McDonald’s plans to chip in $165 million to help out franchisees and boost marketing efforts. The chain has also revived its popular McRib for a limited time and unveiled a new value menu that will launch in January.
Analysts are optimistic that McDonald’s will be able to put the incident behind it. Traffic turned positive in the week ended Dec. 8 for the first time since the Centers for Disease Control and Prevention announced the outbreakon Oct. 22, according to a note from Gordon Haskett Research Advisors.
For rivals Burger King and Wendy’s, that’s bad news.
Like McDonald’s, Burger King launched a $5 value meal over the summer to appeal to thrifty consumers. Its same-store sales fell in the third quarter, although Restaurant Brands CEO Josh Kobza said the business is much healthier than it was in September 2022, when the parent company formally launched Burger King’s U.S. turnaround strategy.
Likewise, Wendy’s has been struggling to gain a foothold in the value wars. The company recently announced that it would close 140 underperforming restaurants in the fourth quarter, in the hopes that culling its footprint would boost the overall business.
But a promotion tied to the 25th anniversary of Spongebob Squarepants has been a green shoot for the burger chain. Some locations even sold out of key ingredients for the “Krabby Patty” meal, according to an October note from Wolfe Research.
Taco Bell is another rare fast-food winner.
The Mexican-inspired chain was the only one of Yum Brands’ three holdings to report same-store sales growth every quarter so far this year. (Pizza Hut and KFC actually reported three straight quarters of same-store sales declines.)
Yum executives have attributed Taco Bell’s success to consumers’ perception of its value. It was the top limited-service chain that diners across all income groups considered to be more affordable than groceries, according to a Numerator survey of more than 2,000 consumers.
Yum has also credited Taco Bell’s “brand buzz.” Look no further than actress Selena Gomez’s Instagram post sharing her recent engagement, with Taco Bell’s Mexican Pizza prominently displayed on a picnic blanket; the brand’s PR chief said in a LinkedIn post that Taco Bell didn’t sponsor the post.
And the chain keeps moving. It’s rolling out artificial intelligence software to take drive-thru orders in hundreds of locations. And in early December, it unveiled a new drink-focused concept, called the Live Mas Café. The first location is being tested in San Diego.
As Taco Bell continues to stand out, Yum plans to highlight the brand in late January with an investor presentation outlining its strategy for next year.
Fast-casual restaurants are the only restaurant segment to report traffic growth this year.
Cava’s stock has skyrocketed 192% this year. Wingstop’s quarterly same-store sales have climbed more than 20% in every report it’s released this year. And traffic to Chipotle’s restaurants keeps growing, despite online backlash over its portion sizes and the departure of longtime CEO Brian Niccol in September.
But it isn’t just those chains. Broadly, the fast-casual restaurant segment has seen traffic rise 3% through October compared with the year-ago period, according to Circana data. And dollar sales have increased 8% for the category.
“You spend more money by going out rather than staying in, and fast casual seems to strike the right balance of the value equation,” said Circana’s Portalatin.
Chipotle and its fellow fast-casual chains also benefit from a customer base that skews higher-income. Chipotle executives have previously said that they haven’t seen the same traffic reversals as the rest of the industry because the chain’s customers have more money to spend on eating out.
Of course, there were a few losers even in the fast-casual category. Chains like BurgerFi and Roti filed for Chapter 11 bankruptcy as their traffic fell and costs rose.
“Maybe they expanded too quickly and had other issues, and so they got into trouble,” John Bringardner, head of Debtwire.
Niccol shocked the restaurant world in August when Starbucks announced he’d be taking over as chief executive, following his predecessor’s ouster. Chipotle’s stock fell and Starbucks shares soared on the news in a combined market cap swing of $27 billion, showing Wall Street’s belief in Niccol as a leader.
Niccol’s departure from Chipotle came six years into his tenure. He ushered the burrito chain firmly out of its foodborne illness crisis, leaned into online ordering, modernized its locations for the digital age and led the company through the pandemic. Wall Street analysts expect that his replacement, Scott Boatwright, will stay the course set by Niccol.
On the other hand, Niccol’s appointment at Starbucks will likely mean big changes for the coffee giant. The board hired him after two consecutive quarters of same-store sales declines. Customers had become fed up with its high prices and chaotic, unwelcoming stores, and even discounts and new drink launches couldn’t persuade them to return.
As CEO, Niccol has pledged to bring the company “Back to Starbucks.” In late October, he shared early thoughts to reshape the U.S. business, from small tweaks like bringing back Sharpies to much more ambitious plans, like cutting back its extensive drinks menu.
Heading into 2025, Wall Street is excited about his proposals. Piper Sandler ranked Starbucks as its best idea for restaurants that it covers. BTIG also named it as a top pick, alongside Wingstop.
Traffic to casual-dining restaurants has fallen 2% year-to-date through October, according to Circana data.
This year’s decline in visits follows years of waning demand for casual-dining chains. They’ve struggled to compete since the Great Recession, which brought the dawn of fast-casual options that offer high-quality food at cheaper prices with greater convenience.
Some consumers are also skipping casual-dining chains and instead frequenting local independents.
The segment’s biggest losers this year were Red Lobster and TGI Fridays, which both filed for Chapter 11 bankruptcy. Red Lobster, which filed in May, has since exited bankruptcy with a new owner, leadership and strategy to turn around the business.
“You’re seeing some weeding out … of those concepts that are a little tired, a little under pressure,” Circana’s Portalatin said.
Other casual-dining chains that are struggling to win over customers include Applebee’s, owned by Dine Brands.
Still the category has some outliers, like Texas Roadhouse, Chili’s and Olive Garden. Their relative outperformance has boosted the segment’s metrics, hiding some chains’ deeper deterioration. (Olive Garden parent Darden Restaurants reports its latest quarterly results on Thursday.)
While casual restaurants struggle, one bright spot was Chili’s, owned by Brinker International. A table at the chain more associated with families became a hot reservation among Gen Z diners.
The bar and grill’s turnaround finally took hold this year, boosted by sharp advertising and TikTok-viral deals. In its latest quarter, Chili’s reported same-store sales growth of 14.1%, fueled by a 6.5% increase in traffic.
The chain’s “3 for Me” bundle, priced at $10.99, appealed to consumers looking for value. Plus, Chili’s advertised the promotion by taking aim at the prices of its fast-food rivals. And its Triple Dipper combo, which offers three appetizers, took off on TikTok, causing sales of the menu item to soar more than 70% in its latest quarter compared with last year. The Triple Dipper now accounts for 11% of the chain’s business, Brinker CEO Kevin Hochman said on the company’s latest earnings call on Oct. 30.
Chili’s success has spawned copycats. Rival Applebee’s recently picked a fight with Chili’s over its competing $9.99 value meal. And Olive Garden reintroduced its Never Ending Pasta Bowl promotion.
In mid-November, restaurant executives were feeling optimistic about 2025 at the Restaurant Finance and Development Conference in Las Vegas.
Circana’s Portalin echoed that sentiment, predicting that inflation will keep declining next year, bringing some much-needed stability to prices and the overall industry.
“Think about everything consumers have dealt with over the last year: natural disasters, global conflict, the polarizing national election,” he said. “If we could get all of that in the rear view mirror, and if we can maintain some of these basic fundamentals around income and labor, we think customer traffic will improve in 2025.”
But not everyone in the industry is so sure that 2025 will bring a restaurant recovery.
“I think we’re going to continue the same mindset that we’re leaving 2024 with, this value-oriented, deal-driven consumer,” Placer.ai’s Hottovy said.
Likewise, Moody’s outlook for the restaurant industry predicts modest sales growth, but Moody’s Zuccaro said companies will all be fighting for their share.
In other words, the value wars won’t slow down — and may even intensify.