Cameco Corp (NYSE: CCJ) is flying early on in the trading session this morning, and for good reason. The company announced that a Tax Court in Canada has ruled in its favor. As you would imagine, the news excited investors, sending the stock screaming for the top. Today, we’ll talk about:
- The ruling;
- what we’re seeing from CCJ stock as a result; and
- what we’ll be watching for ahead.
CCJ Announces Positive Ruling
As mentioned above, Cameco is having a strong start to the trading session this morning after the company announced a ruling from a Canadian Tax Court. In a press release, the company said that the Tax Court of Canada has ruled unequivocally in favor of the company in a dispute of the reassessment issued by Canada Revenue Agency for the 2003, 2005 and 2006 tax years.
In the release CCJ said that the tax court ruled that the company’s marketing and trading structure involving foreign subsidiaries and the related transfer pricing methology used for certain intercompany uranium sale and purchase agreements are in full compliance with Canadian laws for the tax years in question. In a statement, Tim Gitzel, President and CEO at CCJ, had the following to offer:
We are very pleased with the Tax Court’s clear and decisive ruling in our favour… We followed the rules, yet this dispute has caused significant uncertainty for our investors during a period of prolonged weakness in markets for our products. Now we hope CRA accepts the decision and applies it to other tax years in dispute, so we can focus on managing our business for the benefit of all our stakeholders.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to dig into the market is that the news leads to moves. In the case of CCJ, the news proved to be overwhelmingly positive. After all, with the ruling, there is no additional tax burden placed on the company. Of course, the news excited investors who are pushing the stock for the top. At the moment (8:39), CCJ is trading at $11.38 per share after a gain of $1.55 per share or 15.77% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on CCJ. In particular, we’re interested in following the story surrounding the company’s continued operations now that this headache is behind them. Nonetheless, we’ll continue to follow the news closely and bring it to you as it breaks!
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