11 Best Nuclear Energy Stocks To Buy Today

In this article, we will be taking a look at the 11 best nuclear energy stocks to buy today.

In light of growing concerns when it comes to the climate crisis, increasing focus is being drawn to alternate forms of energy generation. Nuclear energy is merely one such alternate form, offering immense growth potential and profitability from an investment perspective. Many energy companies are thus beginning to add nuclear energy to their scope of operations, while those companies established with the mandate of utilizing nuclear energy resources, namely nuclear energy pure-plays, have begun to see a marked increase in investor interest in their projects.

Major energy companies such as BHP Group (NYSE:BBL), ConocoPhillips (NYSE:COP), and Exxon Mobil Corporation (NYSE:XOM) have long dominated the market with their sheer profitability and attractive income investing prospects in some cases. Similarly, nuclear energy stocks are beginning to gain an edge because of the expected rise in the use of nuclear power over the coming years. This September, the International Atomic Energy Agency (IAEA) revised its annual projections for the potential growth of nuclear power over the next few decades. The organization’s new outlook for global nuclear capacity for electricity generation by 2050 has increased its high-case scenario by 10%. The high-case scenario envisions about 873 gigawatts net electrical of nuclear-generating capacity by 2050.

The expected growth in the use of nuclear power and rising interest in this resource has resulted in uranium funds soaring from their lows this summer. According to a Bloomberg article published this September, the $1.8 billion Global X Uranium ETF rallied by 30%, while the $1 billion Sprott Uranium Miners ETF skyrocketed by 43% from their lows in July. The Global X Uranium ETF managed to generate $70 million in net flows in August as well.

Photo by Frédéric Paulussen on Unsplash

Let’s now take a look at the 11 best nuclear energy stocks to buy today.

Our Methodology

We have selected energy stocks which are either nuclear energy pure-plays or traditional energy stocks with a growing focus on the use of nuclear power for energy generation, for our list below. The stocks are ranked based on the number of hedge funds holding stakes in them, from the lowest to the highest. We have considered key metrics such as their EBITDA growth, revenue growth, liquidity, and more when selecting these stocks.

Best Nuclear Energy Stocks To Buy Today

11. Ur-Energy Inc. (NYSE:URG)

Number of Hedge Fund Holders: 3

Ur-Energy Inc. (NYSE:URG) is an energy company working to acquire, explore, develop, and operate on uranium mineral properties. It holds interests in 12 projects in the US. The company is based in Littleton, Colorado.

The company is well-positioned to capitalize on the expected boom in the uranium industry. The industry is expected to see significant growth in light of decisions by Japan to restart nuclear reactors, and by China to build plants to boost domestic power generation. Ur-Energy Inc. (NYSE:URG) had $43.3 million in cash against its total debt of $12.3 million by this June. This shows a net cash position of about $31 million, meaning the company has significant liquidity. Ur-Energy Inc. (NYSE:URG) also has $15.7 million in finished pounds of uranium, representing upside potential for its share price as this commodity can be marketed at a higher price than the price it currently holds.

Three hedge funds were long Ur-Energy Inc. (NYSE:URG) in the third quarter, with a total stake value of $11.8 million. CQS Cayman LP was the largest stakeholder in the company, holding 10.8 million shares worth $11.7 million.

Ur-Energy Inc. (NYSE:URG), like BHP Group (NYSE:BBL), ConocoPhillips (NYSE:COP), and Exxon Mobil Corporation (NYSE:XOM), is a nuclear energy stock many elite hedge funds are piling beginning to consider today.

10. Centrus Energy Corp. (NYSE:LEU)

Number of Hedge Fund Holders: 3

Centrus Energy Corp. (NYSE:LEU) is a supplier of nuclear fuel and services for the nuclear power industry in the US, Japan, Belgium, and internationally. The company operates through its Low-Enriched Uranium and Technical Solutions segments. It is based in Bethesda, Maryland.

On a year-to-date basis, the company’s LEU segment has generated $123.4 million in revenue, representing an increase from $115.3 million in 2021. Centrus Energy Corp.’s (NYSE:LEU) gross margin has also grown year-over-year from $39.2 million to $63.6 million. Additionally, the company is also shielded from paying income tax for the coming years since its large deferred tax asset was not used in the third quarter. Centrus Energy Corp. (NYSE:LEU) reported revenues of $33.2 million in the third quarter.

Three hedge funds were long Centrus Energy Corp. (NYSE:LEU) in the third quarter, while six hedge funds were long the stock in the previous quarter. Their total stake values were $14.9 million and $14.7 million, respectively.

Diamond Hill Capital, an investment management company, mentioned Centrus Energy Corp. (NYSE:LEU) in its third-quarter 2022 investor letter. Here’s what the firm said:

“We initiated holdings in three new companies in Q3: Douglas Emmet Inc (DEI), United States Lime & Minerals (USLM) and Centrus Energy Corp. (NYSE:LEU). Nuclear power industry services provider Centrus Energy is well positioned to benefit from growth in next-generation nuclear technology, helping provide reliable and carbon-free electricity.”

9. Energy Fuels Inc (NYSE:UUUU)

Number of Hedge Fund Holders: 9

Energy Fuels Inc (NYSE:UUUU) is an energy company engaged in the extraction, recovery, exploration, and sale of conventionally and in situ uranium recovery in the US. The company is based in Lakewood, Colorado, and owns and operates the Nichols Ranch project, the Jane Dough property, and the Hank project in Wyoming. It also owns the White Mesa Mill in Utah.

Canaccord’s Katie Lachapelle holds a Speculative Buy rating on Energy Fuels Inc (NYSE:UUUU) shares as of November 16.

Energy Fuels Inc (NYSE:UUUU) has entered into contracts to supply nuclear facilities until 2030. The company also sold its Alta Mesa project earlier in November for $120 million, a move representing significant profitability since the company had purchased this asset for $13.6 million in 2016. The proceeds from this sale should allow the company to fund its ongoing operations with ease. Energy Fuels Inc (NYSE:UUUU) also has a strong balance sheet sporting over $88 million in cash and marketable securities and $27 million in inventory.

Driehaus Capital was the largest stakeholder in Energy Fuels Inc (NYSE:UUUU) in the third quarter, holding 1.2 million shares worth $7.5 million. In total, nine hedge funds were long the stock with a total stake value of $19.7 million.

8. Denison Mines Corporation (NYSE:DNN)

Number of Hedge Fund Holders: 12

Denison Mines Corporation (NYSE:DNN) is an energy company that works to acquire, explore, develop, extract, process, sell, and invest in uranium properties in Canada. It is based in Toronto, Ontario. The company’s flagship project is the 95% interest-owned Wheeler River uranium project in the Athabasca Basin region in northern Saskatchewan.

Denison Mines Corporation (NYSE:DNN) has sizable physical uranium holdings and an impressive amount of U308 reserves in its Wheeler River project. This project is expected to produce 109.4 million pounds of U308 over a 14-year mine life. Denison Mines Corporation (NYSE:DNN) is also keeping its costs at a minimum with its In Situ Uranium Recovery Process.

There were 12 hedge funds long Denison Mines Corporation (NYSE:DNN) in the third and second quarters both. Their total stake values were $18.8 million and $21.9 million, respectively.

7. NuScale Power Corporation (NYSE:SMR)

Number of Hedge Fund Holders: 13

NuScale Power Corporation (NYSE:SMR) is a company that develops and sells modular light water reactor nuclear power plants to supply energy for electrical generation, district heating, desalination, hydrogen production, and other process heat applications. The company is based in Portland, Oregon.

Jon Windham at UBS initiated coverage of NuScale Power Corporation (NYSE:SMR) shares with a Neutral rating and a $13 price target on October 25.

NuScale Power Corporation (NYSE:SMR) is a leading company in technological development and the regulatory approval process when it comes to companies developing SMR technology. Each of the company’s NuScale Power Modules is capable of generating 77 MWe of nuclear energy. The company’s design also allows for a 60-year operational lifetime of its modules. As of this June, NuScale Power Corporation (NYSE:SMR) had $350 million in cash and no debt. It thus expects to be fully financed for its business plan.

Our hedge fund data shows 13 funds long NuScale Power Corporation (NYSE:SMR) in the third quarter, with a total stake value of $39.9 million.

6. Nexgen Energy Ltd. (NYSE:NXE)

Number of Hedge Fund Holders: 15

Nexgen Energy Ltd. (NYSE:NXE) is an exploration and development stage company working to acquire, explore, evaluate, and develop uranium properties in Canada. The company is based in Vancouver, Canada.

The proven deposits held by Nexgen Energy Ltd. (NYSE:NXE) would allow shareholders to profit from the company in any scenario. The company’s planned production of uranium from its assets can be seen as representing about 15-20% of global uranium production. Nexgen Energy Ltd. (NYSE:NXE) currently holds sufficient cash or current assets to cover all its debt and liabilities. With total liabilities of $70 million including $54 million of long-term debt against a total equity of $325 million, the company has a low debt-to-equity profile.

Nexgen Energy Ltd. (NYSE:NXE) was found among the 13F holdings of 15 hedge funds in the third quarter, with a total stake value of $63.7 million. Of these funds, Waratah Capital Advisors was the largest stakeholder in the company, holding 3.7 million shares worth $13.5 million.

Nexgen Energy Ltd. (NYSE:NXE), like BHP Group (NYSE:BBL), ConocoPhillips (NYSE:COP), and Exxon Mobil Corporation (NYSE:XOM), is an energy stock rapidly gaining popularity among investor circles this year.

5. BHP Group (NYSE:BHP)

Number of Hedge Fund Holders: 20

BHP Group (NYSE:BHP) is an Australian resources company. It engages in the mining of several minerals including uranium.

James Redfern at Bank of America upgraded BHP Group (NYSE:BHP) from Neutral to Buy on November 23.

An expected rally in commodities may benefit BHP Group (NYSE:BHP) in 2023. This June, the company reported profit from operations of $34.1 billion, up 34% from the year before. The board also determined to pay a dividend of $1.75 per share of $8.9 billion, bringing the company’s payout ratio to 77%.

There were 20 hedge funds long BHP Group (NYSE:BHP) in the third quarter, with a total stake value of $1.03 billion.

4. Duke Energy Corporation (NYSE:DUK)

Number of Hedge Fund Holders: 33

Duke Energy Corporation (NYSE:DUK) is an American energy company. It uses nuclear fuel, hydroelectric, natural gas, oil, and other energy resources to generate electricity.

Guggenheim’s Shahriar Pourreza holds a Buy rating on Duke Energy Corporation (NYSE:DUK) as of October 24, alongside a $97 price target.

Duke Energy Corporation (NYSE:DUK) has a significant dividend yield of 4.1% as of November 30. The company’s payout ratio for 2022 is expected to stand at 74%. Its annual EBITDA growth is also expected to accelerate to 6.7%, while its EPS growth has also remained consistent.

Duke Energy Corporation (NYSE:DUK) was found among the 13F holdings of 33 funds in the third quarter. Their total stake value was $400 million.

3. Exelon Corporation (NYSE:EXC)

Number of Hedge Fund Holders: 43

Exelon Corporation (NYSE:EXC) is an energy company working on energy generation, delivery, and marketing businesses in the US and Canada. The company owns nuclear, fossil, wind, hydroelectric, biomass, and solar generating facilities.

A Neutral rating was reiterated on Exelon Corporation (NYSE:EXC) shares on October 24 by analyst Shariar Pourreza at Guggenheim.

Exelon Corporation (NYSE:EXC) had strong EPS growth in the third quarter, in the 6-8% range, along with an attractive dividend yield of 3.38%. Analysts at Bank of America see the company’s earnings rising by 10% in 2022, and in 2023 the per-share profit growth is seen at 3%.

Our hedge fund data shows 43 funds long Exelon Corporation (NYSE:EXC) in the third quarter, with a total stake value of $1.5 billion.

ClearBridge Investments, an investment management firm, mentioned Exelon Corporation (NYSE:EXC) in its first-quarter 2022 investor letter. Here’s what the firm said:

“U.S. electric utility Exelon (NASDAQ:EXC) was also a top contributor. Exelon is a pure transmission and distribution regulated utility business serving millions of electric and gas customers across Delaware, Illinois, Maryland, New Jersey, Pennsylvania and the District of Columbia. Shares outperformed along with the utilities sector; Exelon is also starting to be viewed as a premium name after its recently completed spin-off of power generation business Constellation Energy (NASDAQ:CEG).”

2. Cameco Corporation (NYSE:CCJ)

Number of Hedge Fund Holders: 46

Cameco Corporation (NYSE:CCJ) is an energy company based in Canada. It produces and sells uranium, operating through its Uranium and Fuel Services segments.

Greg Barnes at TD Securities reiterated a Buy rating on Cameco Corporation (NYSE:CCJ) shares on October 28.

Cameco Corporation (NYSE:CCJ) is one of the largest companies in the nuclear energy sector, with a market cap of $10.4 billion. It has contracted nearly 23 million pounds of uranium over the next five years.

In total, 46 hedge funds were long Cameco Corporation (NYSE:CCJ) in the third quarter. Their total stake value was $569 million.

Aristotle Capital Management, LLC, an investment management company, mentioned Cameco Corporation (NYSE:CCJ) in its second-quarter 2022 investor letter. Here’s what the firm said:

“After making a strong run in the beginning of the year, Cameco Corporation (NYSE:CCJ), the world’s largest publicly traded uranium producer, was a primary detractor for the quarter. As countries focus on energy security and increasingly rely on nuclear energy, market dynamics are shifting in Cameco’s favor. Supply has tightened as the developed world pivots from Russia, a large supplier of uranium, while demand for non-Russia-linked uranium has increased. While we recognize there has been, and will likely continue to be, short-term volatility in uranium prices, we admire Cameco’s prior actions of operational discipline, which we believe have positioned the company to benefit from the current market dynamics. Cameco remains focused on prudently and profitably increasing production of its Canada-based assets, including an increase of its ownership stake in the Cigar Lake joint venture, as well as the planned start of production at the McArthur River/Key Lake mines in 2024. As these operations come online, we believe Cameco will be able to meet its utilities customers’ demand for long-term supply at higher equilibrium prices.”

1. ConocoPhillips (NYSE:COP)

Number of Hedge Fund Holders: 64

ConocoPhillips (NYSE:COP) is a traditional energy company working to delve into the nuclear energy sector. The company’s Conquista Project has been developed and operated as a mill for the processing of uranium bearing ore from conventional surface mines in Texas.

Citigroup analyst Alastair Syme reiterated a Buy rating on ConocoPhillips (NYSE:COP) on November 22.

The company has an implied capital return of over 9.5% as of this Novermber. ConocoPhillips (NYSE:COP) also had free cash flow of $4.7 billion in the third quarter of 2022, meaning the company can buy back all its debt with the $10.7 billion of cash on its balance sheet.

Out of 920 hedge funds tracked in the third quarter, 64 funds were long ConocoPhillips (NYSE:COP). Their total stake value was $2.7 billion.

ClearBridge Investments, an investment management company, mentioned ConocoPhillips (NYSE:COP) in its third-quarter 2022 investor letter. Here’s what the firm said:

“ConocoPhillips (NYSE:COP) handily outperformed the energy sector, which led the value benchmark. Its exposure to natural gas helped the stock perform more in line with natural gas E&Ps, which led the sector due to the European energy crisis and U.S. shale gas being considered a secure long-term source of liquid natural gas. In addition to COP’s low-cost resource base, conservative balance sheet and experienced management team, we appreciate its strong focus on ESG measures, which we believe is a good indicator of the quality of a company’s business model and management team.

Specifically, we appreciate solid governance practices with compensation metrics emphasizing ROCE and relative total shareholder return, the board’s effective oversight of management as well as the company’s methane flaring leadership. COP is investing in field electrification and carbon capture across its portfolio, with ambitions to deliver oil production with a CO2 intensity of sub-5 kg/BOE, which would be one of the lowest emission sources of supply in the world.”

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Disclosure: None. 11 Best Nuclear Energy Stocks To Buy Today is originally published on Insider Monkey.