The slaughter just seems to continue with uranium producers. Cameco is now at 19 and sporting a pedestrian PE of 17 with a dividend yield around 2%. It is almost looking like a value play now despite an earlier run at 45.
It is now actually close to its 2009 low.
I know some are really down on Uranium but Japan has only talked about moving away from Uranium - I don't know if they'll be able to do it. Germany has long-range plans about not pursuing more nuclear power plants but again it remains to be seen what they'll do. Meanwhile we know that India and China are continuing to build more plants. We also know that current uranium production is insufficient for existing uranium use with the gap filled from decommissioned nuclear arms warheads. However, those warheads are now also running out.
I think this is a good opportunity for a long-term contrarian bet but I would wait for a more solid bottom to form as these guys just continue to sink. Cameco is the strongest player in the field and they have the hedging programs in place to ride out any weakness in uranium spot prices. They also seem to be intent on trying to expand with the hostile takeover of Hathor. I also wonder if they make a play on Denison Mines with their stocks down about 75% from their yearly high and trading at 1.19 now.
I guess I'm ready to jump in once the knife stops falling. Are any of you guys about ready to wade in?
I've already got wet at least to the waist with full submersion pending
India & China are forging ahead and Japan and Germany may not be able to quickly decommission their plants.
I'm thinking about plunging in on Monday and then may continue to average down as I'm pretty happy with where the price is right now. Then I'll just sit back and wait. Maybe I'll sell some puts for CCJ (Cameco on the NYSE).
Originally Posted by Assetologist
no one is in this stock anymore?
As obvious it can be, my username is pro nuclear.
Anyways, I see bright future for the nuclear industry for decades to come.
Care to disagree?
I still own Cameco. I have an ACB in the low $20 range. Perhaps I should have waited but I am content to pick up an accidental dividend nearing 2% while I wait. (Just as good as keeping it in a HIS).
I can see this sector hurting for some time but I see it as a "there's a little problem we didn't anticipate" turnaround value play as Peter Lynch would put it. It will rebound it's just a question of when. Nuclear power is here to stay. Even Germany's plan to decommission is so far into the future it's irrelevant. Besides Germany has bigger things to worry about atm.
I recently saw a commercial on BNN by UAX. I found it amusing that they were trying to find shareholders by using a takeover target campaign. There were many comparisons made to Hathor in the ad. Perhaps they feel it is an opportune time now that Cameco has withdrawn from the Hathor acquisition. Drilling results are supposed to be released from UAX in a couple of weeks if I recall.
Did China and Indian finished their safety reviews amid Japan accident yet?
I beileve they did, but the industry is not reacting.
We have the science backing us. Anti nuclear groups have oil and gas companies backing them up. I wonder who will win lol. If you look at the funding source of anti nuclear groups, you will notice that they can be traced directly back to oil and gas companies.
Nuclear energy competes directly with fossil fuels, not with renewables. Renewables at their current stage is simply too expensive to compete against nuclear and fossil fuels.
Aside from Greenpace (they are against everything that promotes economic growth) also against nuclear power; however they are busy with drilling, fracking, building, everything lol.
Who provides funding for Greenpace anyways lol since they are against everything.
I have doubled down, now holding several thousand shares with an average price just under $20.
I am content to hold a world class company in the energy field and which pays a dividend.
Well I don't have several thousand shares ( i wish) but I just bought another 30 shares for my daughters RESP @ 19.19 last week. Brings my total up to 120 shares with an average position of 22.39.
I played the contrarian bet shortly after the Fukushima disaster so I'm in around $26. I haven't averaged down yet as I didn't want to be overweight in this industry. I'm a little more balanced now and if I free up some cash I'll probably buy a bunch more.
As mentioned above, China has a bunch of new reactors currently being built, and there's currently not enough uranium being produced to supply all the new reactors that are planned to come online in the near future.
Playing the contrarian card was fine rd aaron, but 'shortly after' was the problem.
I'm bullish as well and so are the Australians [though for different reasons], who are now selling to India.
Last edited by Toronto.gal; 2011-12-05 at 12:04 PM.