Uranium Stocks

Uranium Stocks

Nuclear energy, once taboo, is quietly gaining traction on the global stage.

Cleaner than our current sources, demonstrably safer, and boasting major energy output, nuclear seems to be rebounding into a second shot.

And that translates to huge potential upside for select uranium stocks in the months and years ahead.

There’s one, in particular, that’s capturing the current tailwind and will continue riding it into the future.

Easing Regulations, Funding Surges

2020 saw the U.S. Nuclear Regulatory Commission (NRC) proposing changes like utilizing standardized designs and risk-informed regulations to expedite licensing.

These licenses open up a significant uranium market, enabling companies to build, manage, and decommission commercial reactors, handle nuclear materials, and establish waste management sites.

Then, in 2021, we all likely remember the Congress-blessed Infrastructure Law.

Tucked inside was $6 billion allocated to existing nuclear power plants and pioneering nuclear tech research.

A year later, 2020's dreams materialized when the Nuclear Energy Act streamlined new nuclear reactors and advanced nuclear tech procedures.

These three essential moves on the regulation side have cultivated a more positive public opinion.

Pew reports 57% of Americans favored more nuclear plants in 2023, echoing Gallup's finding showing 64% supported nuclear power.

That's the highest level since 2011…

And it couldn’t have come at a better time.

The Supply and Demand Conundrum

Today, there's a significant supply-demand gap in the uranium market, intensifying into the future as the world pursues alternative energy sources.

Currently, we have 436 active nuclear reactors internationally, with 173 being developed.

A new mine can require 10-15 years to become fully functional, so increasing production on those already developed and investing in those far along the development plan will be critical.

The U.S., France, and China account for around 58% of complete global uranium demand, with 70% of France's energy originating from nuclear (the U.S. stands around 20%).

Global demand was approximately 195,000 tons last year, while production remained at 142,000 tons. Not a large gap – and that's part of what accounts for the price hike here.

The issue lies in future supply. 70% of the world's uranium supply hails from Kazakhstan, Canada, Namibia, and Australia. By 2040, global suppliers will be creating an estimated 106,000 tons, while demand will exceed 270,000 tons. In total, there'll be an approximate 680,000-ton supply gap, leading to a prolonged deficiency and much higher prices.

uranium supply gap

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So, who'll "win" this race?

The Stock to Invest in Now

biggest uranium companies by production

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Of all these companies, the $20 billion Canadian operator, Cameco Corp. (CCJ), is the best choice to play this boom.

In 2020, it was just a penny stock.

Now, it's over $40 per share, and we're still in the early innings.

It solidified its position as a major uranium operator by recently tallying $844 million in quarterly revenue – and growing.

Order books throughout the industry are overflowing, with significant suppliers like Urenco achieving $14 billion. The U.S.'s consideration of forbidding Russian nuclear fuel Imports could be an additional boon.

What's best regarding Cameco is that it just prolonged the life of one of its major projects, the Cigar mine, until 2036.

All things considered, the company anticipates 11,000 tons (which is around a tenth of global supply) of production this year, and project extension with surging prices and a global supply gap could propel prices much higher into the future.


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