Here’s Why You Should Try Investing in Nexgen Energy (NXE)

L1 Long Short Fund, an investment management firm, released its second-quarter 2025 investor letter. The L1 Long Short Fund (LSF) portfolio generated a return of 12.2% for the June quarter, outperforming the ASX200 Accumulation Index (ASX200AI), which advanced 9.5% over the same period. Over the past five years, the portfolio has delivered a compound annual return of 21.0%, significantly ahead of the ASX200AI’s 11.8% per annum. This consistent outperformance reflects the firm’s disciplined long/short investment approach and ability to navigate dynamic market conditions. In addition, you can check the fund’s top 5 holdings to find out its best picks for 2025. A copy of L1 Long Short Fund’s Q2 2025 investor letter is available for download here.

One of the companies mentioned in the letter is Nexgen Energy Ltd. (NYSE:NXE). Nexgen Energy Ltd. (NYSE:NXE) operates as an exploration and development stage company, engages in the acquisition, exploration, evaluation, and development of uranium properties in Canada. Over the past month, Nexgen Energy Ltd. (NYSE:NXE) rose by 24.69%, and its shares gained 37.69% of their value over the last 12 months. On September 22, 2025, Nexgen Energy Ltd. (NYSE:NXE) shares closed at $8.93, with a market capitalization of $5.22 billion.

Here is what they have to say about Nexgen Energy Ltd. (NYSE:NXE) in their investor letter:

Nexgen Energy Ltd. (NYSE:NXE) (Long +47%) moved higher as spot uranium prices increased 16% during the June quarter to close at US$74/lb. This move largely recovered the Q1 25 spot uranium price decline that had been driven by low volumes and heightened uncertainty associated with U.S. tariff policy. This occurred even as uranium ‘term’ prices (the agreed contracted price representing almost all commercial uranium demand) held largely steady over the last six months. Sentiment notably improved during the quarter as President Trump signed several executive orders aimed at accelerating U.S. nuclear investment, including a target to quadruple U.S. nuclear capacity from ~100GW today to 400GW by 2050. NexGen is preparing to develop the world’s largest undeveloped uranium deposit, Arrow, located in Saskatchewan, Canada. This will be a major, new, strategic Western source to address the looming uranium market deficit. The company is about to enter the final stage of Federal approval with a commission hearing expected to conclude in H1 26, following which it can commence full scale project construction. Once developed, Arrow has the potential to generate more than C$2b of cash flow annually, assuming a conservative uranium price. We believe this is a compelling proposition given NexGen’s current market cap of only ~C$5b.”

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Nexgen Energy Ltd. (NYSE:NXE) is not included in our list of the 30 most popular stocks among hedge funds. According to our data, 40 hedge fund portfolios held positions in Nexgen Energy Ltd. (NYSE:NXE) at the end of the second quarter of 2025, up from 33 in the previous quarter. While we acknowledge the risk and potential of NXE as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than NXE and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered Nexgen Energy Ltd. (NYSE:NXE) and Petra Capital’s views on the company. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.