It has been about a month since the last earnings report for Centrus Energy Corp. (LEU). Shares have lost about 4.3% in that time frame, underperforming the S&P 500.
But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Centrus Energy due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Centrus Q2 Earnings Beat Estimates on Higher Uranium Sales
Centrus posted earnings of 77 cents per share in the second quarter of 2026, down 51.6% year over year but 4.1% above the Zacks Consensus Estimate of 74 cents.
Excluding growth costs and stock-based compensation, earnings per share came in at $1.77 in the second quarter of 2026 compared with $1.90 in the year-ago quarter.
Revenues of $176.1 million rose 14% and topped the consensus mark of $147 million. The top-line gain was led by higher Low-Enriched Uranium segment revenues, which reflected uranium sales, partly offset by lower Technical Solutions revenues.
As of the end of the second quarter of 2026, Centrus' total backlog reached $4.5 billion and extends to 2040.
Centrus' Profitability Pressured by Expansion Costs
Total cost of sales rose 25%, resulting in a 7% year-over-year decline in gross profit to $49.9 million. Gross margin declined to 28.3% from 34.9% in the year-ago quarter.
Selling, general and administrative expenses surged 96% year over year to $26.2 million. Advanced technology costs surged to $10.8 million from $3.3 million in the year-ago quarter as the company ramped up expansion-related work.
Operating income slumped 69% to $10.4 million from $33.5 million in the year-ago quarter. Operating margin plunged to 5.9% from 21.7% a year earlier.
Adjusted operating income, which excludes growth costs and stock-based compensation, came in at $38.7 million in the second quarter of 2026 compared with $40.8 million in the year-ago quarter. Adjusted operating margin in the second quarter of 2026 was 22% compared with 26.4% in the year-ago quarter.
Centrus' Segment Performance in Q2
The Low-Enriched Uranium segment's revenues increased 22% year over year to $153.4 million. Uranium revenues totaled $53.4 million in the second quarter of 2026 compared with no revenues in the year-ago quarter. SWU revenues fell 20% year over year to $100 million as volumes declined 23%, partly offset by a 3% increase in average selling price.
The segment's cost of sales rose 36% to $101.8 million, mainly because of higher uranium sales volume. SWU costs declined due to lower volumes, but the average unit cost of SWU sold increased 13%. The segment's gross profit edged up 2% to $51.6 million.
Technical Solutions revenues declined 21% to $22.7 million from $28.8 million. The decrease primarily reflected a $5.9 million drop in revenue from the DOE's HALEU Operation Contract.
Cost of sales for the segment decreased 5% to $24.4 million. The decline was attributed to a $1.9 million decrease in costs incurred under the HALEU Operation Contract, with the remaining change attributable to other contracts. The segment, however, posted a gross loss of $1.7 million against a $3.2 million profit a year earlier.
Centrus Expands Backlog as HALEU Awards Build
The Low-Enriched Uranium segment's backlog stood at about $3.7 billion at the end of the second quarter of 2026. It included roughly $3 billion of contingent LEU and HALEU sales commitments, of which $2.4 billion was under definitive agreements supporting potential enrichment capacity expansion in Piketon, OH. Technical Solutions backlog was about $0.8 billion.
Centrus' Cash Flow Reflects Heavy Expansion Spending
Cash used in operating activities was $16.7 million in the first six months of 2026 against an inflow of $89.3 million in the year-ago comparable period. Capital expenditures increased sharply to $94.8 million from $5.7 million as Centrus stepped up investment in its industrial buildout.
Cash and cash equivalents were $1.87 billion at June 30, 2026, compared with $1.96 billion at Dec. 31, 2025.
Centrus Maintains Revenue Outlook for 2026
For 2026, Centrus expects total revenues of $450-$500 million. The company also maintained its total capital deployment outlook of $350-$500 million for the year, to support expansion work at Piketon and Oak Ridge.
Operationally, Centrus now expects to hire at least 175 net new employees in Piketon, up from 100 previously, while maintaining a target of at least 100 net new hires in Oak Ridge. It also expects to complete its first new centrifuge in Oak Ridge by year-end 2026.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
The consensus estimate has shifted -98.21% due to these changes.
VGM Scores
At this time, Centrus Energy has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. However, the stock was allocated a score of F on the value side, putting it in the fifth quintile for value investors.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, Centrus Energy has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Centrus Energy is part of the Zacks Mining - Non Ferrous industry. Over the past month, Freeport-McMoRan (FCX), a stock from the same industry, has gained 6.4%. The company reported its results for the quarter ended June 2026 more than a month ago.
Freeport-McMoRan reported revenues of $7.03 billion in the last reported quarter, representing a year-over-year change of -7.3%. EPS of $0.74 for the same period compares with $0.54 a year ago.
For the current quarter, Freeport-McMoRan is expected to post earnings of $0.73 per share, indicating a change of +46% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.8% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Freeport-McMoRan. Also, the stock has a VGM Score of B.
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This article originally published on Zacks Investment Research (zacks.com).
