Deep Yellow Ltd (ASX: DYL) shares have fallen even further into the red in Monday afternoon trade.
At the time of writing, the ASX uranium development company’s shares are down just over 6.5% for the day, and trading at 77 cents a piece.
At one point this morning, the shares were changing hands as low as 76 cents.
That’s the lowest price Deep Yellow shares have traded at over the past three years.
The shares have now fallen around 43% over the past month alone, and they’re down 61% year to date.
Why have the ASX shares hit a multi-year low today?
There hasn’t been any price-sensitive news out of Deep Yellow today to explain the latest share price slide. Instead, it looks most likely that today’s tumble is the result of the company’s latest ASX announcement.
On Friday last week, Deep Yellow said it has delayed the construction decision for Tumas because current equity market conditions do not support raising the capital needed to transition the project into construction in the fourth quarter of 2026.
The uranium developer’s early construction work and contracting will continue, but investors are likely concerned about whether the company can secure a viable funding route for Tumas.
The shares actually climbed around 1% at the close of the ASX on Friday afternoon. But it looks like over the weekend, investors digested the news and raised concerns about the structural and long-term implications of the update.
The news comes at a time when Deep Yellow is already facing share price pressure.
Rising bond yields and higher interest rates have acted as strong headwinds for ASX uranium shares over the past year. Uranium developers like Deep Yellow need upfront capital, and it takes several years to become profitable. Investors have also been rotating towards more stable or defensive assets in times of volatility.
It’s not just Deep Yellow shares that have fallen over the past week; other uranium shares have also been hit by the same headwinds and are falling today.
Here’s why I think Deep Yellow shares are a bargain buy
It’s understandable that the company’s latest Tumas update has spooked investors.
But I still see some potential upside for the ASX shares.
Beyond its Tumas project in Namibia, the company also has several other key projects and exploration plans.
Deep Yellow is also in a pre-construction and study phase at its Mulga Rock project in Western Australia. The site is one of the largest undeveloped uranium projects in Australia.
The company is also undertaking drilling programs at its Alligator River Project in the Northern Territory, and its Omahola Project in Namibia.
The company is financially strong too.
Deep Yellow holds a strong liquidity position supported by substantial cash reserves and minimal debt. As part of its latest quarterly activity report, Deep Yellow confirmed that it has cash and cash equivalents of A$160.0 million as of the 30th June 2026.
I see the latest share price declines as mostly driven by poor sentiment, a lack of confidence, and sector-wide headwinds. When these headwinds reverse, I think the company’s shares could rebound quickly.
What do the experts tip for the uranium shares next?
The experts are also bullish that we’ll see a strong upside ahead.
Market Index data shows that the majority of brokers have a buy rating on Deep Yellow shares. The $2.25 average target price implies an impressive upside of around 193% for the ASX shares over the next 12 months, at the time of writing.
The post I think this ASX share is a bargain buy after hitting a 52-week low: Here's why appeared first on The Motley Fool Australia.
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Motley Fool contributor Samantha Menzies has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.