Categories: Energy Stocks
Topics: Uranium Stocks

Did U2 Just Turn Pro-Nuclear? It’s Game-On for Uranium Investors!

Everyone will agree... it’s been tough sledding in the markets of late with few signs of relief in sight.  

Yet, uranium investors may have just found that elusive silver lining… and a highly profitable one at that!

With lofty climate goals now understood to be well out of reach without clean-burning nuclear energy being a significant part of the global energy mix, governments around the world are quickly changing their stance on nuclear. 

As a result, uranium prices have skyrocketed to decade-plus highs well above US$60 per pound and may be heading higher still... especially as global energy security continues to deteriorate. 

As just one poignant example of the seachange currently underway, Finland’s Green Party — following decades of staunch opposition — voted overwhelmingly last year to categorize nuclear power as a form of sustainable energy.

Of course, Vladimir Putin cutting off gas and power supplies to much of Europe, including Finland, was likely the final straw… or wake-up call, if you will… pushing nuclear across the finish line for the powers that be. 

At present, one-third of Finland’s electricity is derived from nuclear power. And earlier this year, the country’s OL3 reactor, Europe’s largest, finally went online.

That one reactor alone is expected to meet around 14% of Finland’s electricity demand, somewhat softening the blow being levied by the Kremlin… and just in the nick of time! 

Other European nations are quickly falling in line with Finland’s pro-nuclear stance. Britain, France, and Sweden are each planning new nuclear reactor projects with Belgium and Spain also cementing their support for the clean-burning energy source. 

Even the iconic Irish rock band U2, which just opened a 25-show residency at the $2.3B Las Vegas Sphere, is suddenly onboard with nuclear.

Some of you may recall that this is the same band that became quite infamous in the early-nineties for staging anti-nuclear demonstrations, alongside Greenpeace, at reactors in England. 

Today, U2 is rattling and humming an entirely different tune. Legendary frontman, Bono, now says nuclear power is the answer to the climate crisis and even wrote a new song about it!

Turning to Asia, China recently approved the construction of six new nuclear reactors across three provinces with plans to build 150 new reactors over the next 15 years as part of their newly-enhanced decarbonization mandate.

South Korea and India have also joined the fray and are now fully onboard with a cleaner energy future that will require vast amounts of uranium, or yellowcake as it is commonly referred.

Here at home, TerraPower is currently constructing a US$4B nuclear power plant in Wyoming that’ll use an all-new blend of enriched uranium.

Once completed, it is expected to generate efficient, low-cost, clean energy while utilizing enhanced safety standards that greatly reduce the risk of accident — even on par with wind power plants.

And just a few months ago, NuScale became the first company to be granted approval by the US government on small modular reactor (SMR) design with the US Nuclear Regulatory Commission giving it the green light.

Put plainly, increased uranium demand is coming from ALL angles. 

And that includes a new contracting cycle that’s just now getting underway with major utilities entering the market to secure their next long-term U308 contracts. That factor alone could push uranium prices significantly higher in the coming few quarters. 

On the supply side, global uranium production has stagnated by upwards of 25% in recent years and is being further hampered by a military coup in Mali (4% of global production) and ongoing difficulties at Cameco’s Cigar Lake Mine and Key Lake mill in Canada. 

Of little surprise… uranium has been outperforming ALL other metals thus far in 2023, gaining more than 20% YTD and topping US$65/lb for the first time in 12 years.
 
In turn, that upward pricing momentum is serving to boost the value of select uranium ETFs and large-cap miners through the first three quarters of the year with the Global X Uranium ETF up around 40% YTD, Cameco up 75%, NexGen up 65%, Uranium Energy up 120%, and Energy Fuels up 55%.  

Yet, those respectable gains are nothing compared to what the small-cap explorers are capable of delivering in a rising U308 market like we have today. 

Looking back at the previous uranium boom, well-timed and well-positioned investors saw 1,000%-plus gains with regularity… with some small caps rising as much as 10,000%.

And that’s sort of the nature of the uranium price cycle… long, extended bear markets that test the resolve of even the most hardened uranium bulls… followed by truly violent upswings that make the wait MORE than worth it! 

Take a look at the far right end of the uranium price chart above. It’s as clear as day: we are entering the first bona fide uranium bull market since Cigar Lake flooded way back in ‘07. 

And best of all, it’s still very early-innings in the current uranium boom… so those 10X gains, and higher, are in the process of setting up now.

Over the coming weeks and months, we’ll be bringing you our Top Picks from the small-cap uranium space. 

You’re in the right place to continue to receive those communications. 

In the meantime, now’s an excellent time to commence your own due diligence on the global uranium market.

We think you’ll agree… some of the biggest gains of 2023-24 will indeed be coming from this booming subsector of the clean energy space. 

We’re here to make sure you’re advantageously positioned ahead of the herd.

Mike Fagan
Editor, Daily Profit Cycle