Cameco's (CCJ) recent pullback in shares is driven by broader market and artificial intelligence-related sentiment rather than any change in fundamentals, UBS Securities said in a note Monday.

On uranium, analysts said long-term contract prices have hit record highs, utility contracting and Request for Proposals are increasing, and government support for nuclear continues.

The investment firm said Cameco is the clearest and most liquid global exposure to the nuclear thematic.

Positive catalysts this year for Cameco include an upside to contract prices, meaningful AP1000 announcements or government support, plans for physical uranium futures, and continued supply challenges of incumbents, according to the note.

UBS Securities upgraded its rating to buy from neutral, and retained a price target of 166 Canadian dollars ($117.61).

Price: 88.51, Change: +0.65, Percent Change: +0.74