With a surge in solar and wind powered energy, one would expect that demand for nuclear reactors to produce electricity. Still wary of everything nuclear following the Fukushima disaster, countries like Germany and Japan have stepped up efforts to reduce their dependence on nuclear-powered energy. This does not apply to China and India, whose appetite for nuclear reactors has not faded. With the price of Uranium far from the 2007 high and showing signs of a bottom, we have decided to take a look at the most popular mining stocks that are in the uranium business and see how the hedge funds have positioned themselves in this market.
The smart money sentiment is an important metric that can be used to assess the long-term profitability of a stock. While there are thousands of stocks trading daily on the market, taking a look at what hedge funds think about certain companies can narrow down the search significantly. At Insider Monkey, we track more than 700 hedge funds, whose 13F filings we analyze as part of our small-cap strategy. Our research has shown that imitating a portfolio that includes the 15 most popular small-cap stocks among hedge funds can outperform the market by as much as 95 basis points per month on average (see more details here).
The hedge fund sentiment towards Cameco Corporation (USA) (NYSE:CCJ) has slightly improved over the fourth quarter, with the number of funds with long positions increasing to 24 from 21. Cliff Asness’ AQR Capital Management is bullish on this stock, having increased its stake by 140% over the quarter to 2.85 million shares valued at a little over $35 million. Steven Cohen of Point72 Asset Management is also optimistic about the prospects of the company, having initiated a new position during the quarter and having amassed a total of 3.2 million shares. The management of Cameco Corporation (USA) (NYSE:CCJ) believes the price of uranium is set for a rebound and has stepped up efforts to increase production and to develop new mines in Canada and Australia once it becomes worthwhile. For the 2015 fourth quarter, Cameco Corporation (USA) (NYSE:CCJ) reported a loss of $7.5 million, having been hurt by higher impairment charges. When adjusted for one time costs, the company reported earnings of $0.38 per share on $730.6 million in revenues.