Uranium and nuclear stocks are in the spotlight with several news items leading to investors searching for stocks with exposure to the sector.
For years, nuclear energy was considered an energy source not favored by many and has faced regulatory hurdles to continue. Here is a look at the latest developments in the sector and new people supporting nuclear energy and some stocks to watch.
What Happened: Several notable names are voicing support for nuclear power.
“Unless susceptible to extreme natural disasters, nuclear power plants should not be shut down,” Tesla Inc TSLA CEO Elon Musk tweeted last month.
Among the reasons for more energy is that usage is expected to rise significantly in the U.S. and elsewhere with the increased numbers of electric vehicles, such as those from Tesla.
Twitter Inc TWTR co-founder and Block Inc SQ CEO Jack Dorsey also voiced support for nuclear power.
“Generating more energy, not less, increases quality of life for all,” Dorsey tweeted with a nuclear power emoji.
Dorsey also retweeted a post highlighting how the anti-nuclear power movement may have done more to contribute to climate change than the coal, gas and oil lobby combined.
The U.S. Secretary of Energy has shown support for nuclear power in the country moving forward.
“The United States views nuclear energy as a pivotal technology in the global effort to lower emissions, expand economic opportunity and ultimately combat climate change,” Secretary Jennifer Granholm said.
A new report from scientists from MIT and Stanford outlined a strategy to retrofit the Diablo Canyon nuclear power plant owned by PG&E Corporation PCG. The nuclear power plant is scheduled to be shut down by 2025. PG&E does not plan to keep the plant open, but the scientists were hopeful a different utility company would take it over.
Anti-nuclear sentiment in California was contributed as a factor in the decision to close the plant. Now with scientists supporting nuclear energy going forward, nuclear power plants could make comebacks or encounter fewer closures going forward.
Outside of the U.S, French President Emmanuel Macron said in November the country would build new nuclear reactors. The announcement comes as the country seeks to lessen its dependence on global energy supplies from other countries.
This week’s events in Kazakhstan could have a huge impact on the market for uranium, a key component tied to the nuclear power industry. Protests in the country have led to more than 300 being injured and eight police officers being killed.
Kazakhstan makes up around 43% of global uranium production, making it the world’s largest uranium producer. Protests have led to higher prices for uranium and rising values for stocks exposed to the sector.
With the news of nuclear power plants and rising uranium prices, here are several stocks and ETFs investors should keep on their radar.
Cameco: Uranium producer Cameco Corp CCJ is one of the largest pure-play publicly-traded uranium companies. The company has a market capitalization of nearly $10 billion. Cameco has the ability to increase annual uranium production by restarting mines that have been shut down after years of seeing low uranium prices. The company also operates uranium conversion facilities.
NexGen Energy: Mineral exploration company NexGen Energy Ltd NXE acquires and explores uranium properties in Canada.
Uranium Energy Corp: Uranium mining company Uranium Energy Corp. UEC controls the Reno Creek project, which is the largest permitted, pre-construction uranium project in the U.S. Uranium Energy has a pipeline of uranium projects in the U.S. and Paraguay.
Energy Fuels: Uranium producer Energy Fuels Inc UUUU has three uranium production centers in the U.S. The company’s White Mesa mill in Utah is the only conventional uranium mill in the U.S. The company has other uranium mines in development.
Sprott Physical Uranium Trust: Launching in July 2021, the Sprott Physical Uranium Trust SRUUF is the world’s largest physical uranium fund. The fund has a goal of providing a way for investors to get exposure to holding uranium, offering a “liquid and convenient way to own physical uranium.”
Uranium Royalty: The world’s only uranium-focused royalty and streaming company is Uranium Royalty Corp UROY, according to its website. The company makes investments in uranium interest that include royalties, companies and debt investments. Uranium Royalty also owns physical uranium with 1,348,068 pounds in its inventory as of December 2021.
Ur-Energy: Uranium mining company Ur-Energy Inc. URG operates a uranium facility in Wyoming called Lost Creek and has several production projects in the pipeline.
Centrus Energy: Nuclear fuel and services company Centrus Energy Corp LEU sells uranium and offers technical solutions for the sector. Customers include government clients and private sector companies.
Mirion Technologies: Newly public via a 2021 SPAC merger, Mirion Technologies Inc MIR is the global leader in ionizing radiation detection and measurement technologies. The company holds a market share leading position in 14 of 17 operating categories. The company serves the nuclear power products and services, labs and research, civil and defense and nuclear medicine sectors.
Global X Uranium ETF: The largest uranium ETF is the Global X Uranium ETF URA, which launched in 2010. The ETF holds a basket of 44 stocks and has $1.28 billion in assets under management. Top holdings in the ETF are CCJ at 23.6%, NAC Kazatompron at 9.5% and NXE at 7.4%. The ETF is up 58% in the past year and up 29% in the last three years.
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