Should You Buy Cameco While It's Below $61?

Company Overview - Cameco is a large Canadian miner that produces and processes uranium into fuel for nuclear power plants and owns a 49% stake in Westinghouse, providing services to nuclear power companies [2] - It is one of the largest publicly traded producers of uranium globally [2] Market Dynamics - Cameco's stock price is influenced by uranium prices, which fell in February 2024 but have since recovered to around $58 per share [1] - The company operates primarily in North America, a region considered economically and politically stable, which is a key selling point for its uranium [4] - The nuclear power industry experiences significant swings due to external factors, with past events like the Fukushima meltdown impacting uranium demand [5] Long-term Outlook - There is an expected growing supply gap for uranium starting in 2030 due to increasing global nuclear power usage, which could lead to higher uranium prices [9] - Cameco's strategy of signing long-term contracts helps stabilize earnings during periods of falling uranium prices, making it a less volatile investment option [8][10] Investment Considerations - The long-term outlook for uranium demand suggests strong financial performance for Cameco as demand is projected to exceed supply [10] - The company is viewed as a "pick-and-shovel" play on the growth of nuclear power, appealing to conservative investors [10] - However, past nuclear power renaissances have not lasted, and potential future nuclear incidents could negatively impact the industry's perception [11][12]