Exelon Corporation (EXC): Five Reasons Cameco Corporation (USA) (CCJ) Will Rebound

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Smaller uranium players

Cameco Corporation (USA) (NYSE:CCJ) doesn’t face huge competition with respect to uranium. I previously discussed how Cameco compares favorably with bigger mining and energy companies like Rio Tinto and BHP Billiton, which have diversified. BHP Billiton divested its uranium properties and Rio Tinto’s Rossing Mine in Namibia is running under losses.

Denison Mines Corp (USA) (NYSEMKT:DNN) has a successful uranium operation in Saskatchewan, Canada. The company bought several projects from Fission Energy. International Enexco and Denison Mines have begun to drill at the Bachman lake, which is only four kilometers away from Cameco Corporation (USA) (NYSE:CCJ)’s Millenium Deposit. The 1,900 meter diamond drill program may help Denison Mines Corp (USA) (NYSEMKT:DNN) to add more uranium projects to its small portfolio.

The company has a market cap of $530 million and an enterprise value of $522 million. With a profit margin of -212% and an operating margin of -233%, it is not one of the most profitable companies in the space.

Exelon Corporation (NYSE:EXC) is another big name in nuclear. With 17 nuclear reactors under its belt, the company is a gigantic power generator. Through Exelon Nuclear Partners, Exelon has sustained a profitable uranium business that revolves around power generation. The company has operations in the U.S. and Canada.

With a market cap of $26 billion and an enterprise value of $46 billion, Exelon Corporation (NYSE:EXC) is a large company. However, with a PEG ratio of -2.50, the company may have its own share of troubles.

Foolish bottom line

The leaks at Fukushima will not decrease the demand for nuclear fuel in the future. Thanks to an increasing demand for clean fuel in countries like China, India and South Korea, Cameco will find more buyers for its products, increasing its revenue in the long term and making it an attractive buy.

The article 5 Reasons Cameco Will Rebound originally appeared on Fool.com and is written by Jaiyant Cavale.

Jaiyant Cavale has no position in any stocks mentioned. The Motley Fool recommends Exelon.

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