Three Uranium Investments to Purchase for Income and Profits from Russia’s Ruses
By: Paul Dykewicz,
All three should do well despite Putin’s invasion of Ukraine under the pretense of rescuing Russians living in the adjacent country only to fire upon, kill and injure thousands of Ukrainian civilians, including women and children trying to flee bombs, missiles and gun fire. Aside from the loss of thousands of lives on both sides, the three uranium investments to purchase offer ways to earn income and profits amid attacks on Ukrainian hospitals, schools, residential areas, churches and nuclear power plants.
The three uranium investments to purchase for income and profits seem positioned to hurdle Putin’s perplexing policies that have led to the deaths of thousands of his Russian soldiers, aside from Ukrainian men, women and children. Putin’s invasion of Ukraine has spurred economic sanctions from other nations to pressure him to call his troops home.
Putin’s self-made predicament includes bans on selected Russian goods, financial transactions and companies by countries such as the United States, the United Kingdom, Canada, Japan, South Korea and Australia, as well as the European Union. Among the Russian exports that have been affected are Russia’s natural resources, such as oil, natural gas and uranium.
Stiff resistance from Ukrainian defenders protecting their homeland, families and communities is juxtaposed with news reports that 31 senior Russian military officers, including colonels and generals, have been killed in action since Putin ordered the Feb. 24 attack of Ukraine. The battlefield deaths of Russian military leaders and highly trained soldiers have the risk of undermining the morale of their forces, while logistical problems and reports of substandard medical support for the wounded are further hurting Russia’s war-making campaign.
Global X ETF Is One of Three Uranium Investments to Purchase for Income and Profits
“The Russian conflict is going to bolster the case for continuing nuclear energy output at current levels with existing facilities,” said Jim Woods, who heads the Successful Investing and Intelligence Report investment newsletters, as well as the Bullseye Stock Trader and High Velocity Options trading services.
“There is also a good chance that several nations take additional steps to enhance their energy security using this established method,” Woods continued. “Those factors enhance the appeal of global stocks engaged in the discovery and production of nuclear components.”
Woods’ preferred vehicle to participate in this sector is the Global X Uranium ETF (NYSEARCA: URA). The goal of this diversified ETF is to provide investors access to a range of companies engaged in uranium mining and the production of nuclear components, including those in extraction, refining, exploration, or manufacturing of equipment for the uranium and nuclear industries, he added.
URA retreated 2.10% in the past week after surging 8.50% in the previous month, 14.64% for the past three months and 47.20% in the past year.
Chart courtesy of www.stockcharts.com
Cameco Is the Second of Three Uranium Investments to Purchase for Income and Profits
URA offers a basket of 50 global companies engaged in the uranium industry with its largest position, Canada’s Cameco Corporation (NYSE: CCJ), jumping 7% on Monday, March 21. The Saskatoon, Saskatchewan-based company, the world’s largest publicly traded uranium stock, benefitted from a $5 gain per lb. in the price of uranium, equaling 10%, to reach $55 per lb. a week ago. Since then, price of uranium rose nearly 6.9% to $58.60 per lb., as of April 1. Uranium is up 16.89% in the past month and 82.52% in the past year.
The multinational nuclear conglomerate accounts for nearly one-quarter of the ETF’s assets and has an “outsized influence” on the fund’s total performance, Woods said. He liked Cameco well enough to recommend it recently in the Fast Money Alert trading service that he heads with his co-editor, Mark Skousen, PhD.
Nuclear energy is the “best alternative energy source” currently available, Fast Money Alert wrote to its subscribers. Putin’s threats to use the “nuclear option” in his war against Ukraine has contributed to the rising price of the commodity and the stocks and funds tied to uranium.
CCJ gained 0.94% during the past week, 8.50% in the last month, 14.64% for the last three months and 68.65% in the past year.
Chart courtesy of www.stockcharts.com
Skousen Predicts Uranium Will Sustain Its Rise
Uranium and other commodities traditionally are safe havens during times of war, Skousen wrote in the April 2022 edition of his Forecasts & Strategies investment newsletter. Skousen, who also leads the Home Run Trader, TNT Trader and Five Star Trader services, said traditional inflation hedges include oil, gold, silver, copper, uranium and other commodities.
Mark Skousen, editor of Forecasts & Strategies and a descendant of Benjamin Franklin, meets with Paul Dykewicz.
PICK offers the Third of Three Uranium Investments to Purchase for Income and Profits
Bob Carlson, a pension fund chairman who also heads the Retirement Watch investment newsletter, said he prefers to invest in uranium through iShares MSCI Global Metals and Mining Producers (PICK). Carlson began recommending the exchange-traded fund (ETF) last fall and has watched it jump by double-digit percentages.
PICK has dipped 0.58% in the past week, 6.73% for the last month, 20.18% in the past three months and 28.91% in the past 12 months. The ETF tracks an index of global mining companies that excludes gold and silver miners.
Chart courtesy of www.stockcharts.com
The index consists of 216 stocks, but its capitalization weighting means 50% of the fund is in its 10 largest positions. Top holdings recently consisted of BHP Group Ltd. (NYSE: BHP), Rio Tinto Limited (OTCMKTS: RTNTF), Vale S.A. (NYSE: VALE), Freeport-McMoRan Inc. (NYSE: FCX) and AngloAmerican plc (OTCMKTS: NGLOY).
“I was attracted to this ETF even before the invasion of Ukraine,” Carlson commented. “The mining companies had gone through a long bear market. They worked to reduce debt and otherwise clean up their balance sheets. Their more efficient operations mean most of them can profit at relatively low prices for their commodities and will earn strong profits as prices rise. The strong global demand, combined with the recent supply shocks, make them more attractive.”
Bob Carlson, head of Retirement Watch, talks to author Paul Dykewicz.
Roughly 23% of the fund is in North American-based companies. Other leading regions in the fund are the United Kingdom, 13%; Developed Europe, 9%; Emerging Europe, 4.9%; and Africa/Middle East, 4.9%.
President of Portia Capital Management Prefers PICK to Gain Mining Diversification
Michelle Connell, a former portfolio manager who now is the president and owner of Dallas-based Portia Capital Management, said she also likes PICK to diversify beyond a pure play mining stock through a single investment.
Michelle Connell, CEO, Portia Capital Management
“There are several reasons for my rationale,” Connell told me.
One, PICK holds a “plethora of companies” that have very strong fundamentals, Connell continued. Second, PICK’s dividend yield is compelling at nearly 5%, she added.
“Obviously, PICK is not a uranium pure play, but it provides some uranium exposure with more of an investment objective,” Connell counseled.
PICK provides exposure to worldwide mining and production of diversified metals, except for gold and silver. The investment rationale is to buy a basket of diversified metals — many of them necessary for manufacturing — as an inflation hedge.
PICK Outperforms Precious Metals for Past Five Years
Connell commented that she prefers to invest in this ETF, rather than individual uranium companies, since most of the stocks held in PICK are profitable, as well as have positive revenue growth and book value. PICK also has proven to be a better long-term performance versus gold and silver ETFs by outperforming the precious metals on a total return basis for 1 year, 3 years and 5 years, Connell said.
“Maybe this is a better way to hedge for inflation than a gold ETF,” Connell said.
One point of caution is that PICK is market-cap-weighted, with its top 10 stock holdings comprising more than 50% of the ETF’s portfolio, so underperformance by one of those key positions could crimp the fund’s returns, Connell continued.
Freeport McMorran (NYSE: FCX), of Phoenix, Arizona, ranks near the top of the ETF’s biggest positions. The company owns copper mines across the globe. Copper is in short supply and is used in many manufacturing processes, including green technology and electric vehicles. Freeport McMorran is strong fundamentally and its 12-month upside is 30-40%, Connell continued.
Uranium Energy Corp. Is an Non-Dividend-paying Uranium Stock to Purchase
Uranium Energy Corp. (NYSE: UEC), a non-dividend-paying uranium mining and exploration company in Corpus Christi, Texas, describes itself as America’s fastest-growing uranium miner. UEC offers investors a pure play uranium stock that is advancing the next generation of low-cost, environmentally friendly in situ recovery (ISR) mining uranium projects.
ISR is one of two key extraction methods currently used to obtain underground uranium. That method recovers uranium from low-grade ores where other mining and milling techniques may be too costly or environmentally disruptive.
UEC has two production-ready ISR hub-and-spoke platforms in South Texas and Wyoming that are anchored by fully licensed and operational processing capacity at its Hobson and Irigaray Processing Plants. The company also has seven U.S. ISR uranium projects that have major permits in place.
UEC Holds Diversified Collection of Uranium Assets
Plus, UEC has other diversified holdings of uranium assets. They include one of the largest physical uranium portfolios of U.S. warehoused U3O8; a major equity stake in the only royalty company in the sector, Uranium Royalty Corp (NASDAQ: UROY); and a pipeline of resource-stage uranium projects in Arizona, Colorado, New Mexico and Paraguay.
“With the way Russia has operated in Ukraine, they have forfeited their right to operate in Western markets,” said Scott Melbye, executive vice president at Uranium Energy Corporation (NYSE: UEC).
UEC’s stock price fell 4.10% in the past week after soaring 14 99% in the past month, 39.70% in the last three months and 45.79% in the past year.
Chart courtesy of www.stockcharts.com
Uranium Royalty Corp. Is Another Non-Dividend-paying Uranium Company to Purchase
Canada’s Uranium Royalty Corp., of Vancouver, is a non-dividend-paying a royalty company that acquires revenue streams of uranium projects. The uranium price had been improving on a fundamental supply and demand imbalance before Russia’s invasion of Ukraine, said Melbye, who also is the chief executive officer of Uranium Royalty Corp.
The opportunity to develop uranium mining operations in America is genuine, said Melbye, who added that Western companies cannot do business in Russia from an “ethical and moral” standpoint.
“Everybody is basically pulling out of Russia,” Melbye concluded.
Chart courtesy of www.stockcharts.com
UROY has pulled back 5.08% in the past week and the last month, 12.60% in the previous three months and 39.47% for the past year.
Toronto’s Denison Mines Missed out on Joining Three Uranium Investments to Purchase
Toronto’s Denison Mines Corp. (NYSEAmerican: DNN) is a uranium exploration and development company that has interests in the Athabasca Basin region of northern Saskatchewan in Canada. The company also has a 95% interest in its flagship Wheeler River Uranium Project, the largest undeveloped uranium site in the “infrastructure-rich” eastern portion of the Athabasca Basin part of northern Saskatchewan, its officials said.
Denison’s interests in Saskatchewan further include a 22.5% ownership interest in the McClean Lake joint venture, including several uranium deposits and the McClean Lake uranium mill, contracted to process the ore from the Cigar Lake mine under a toll milling agreement.
In addition, Denison Mines holds a 25.17% interest in the Midwest Main and Midwest A deposits, and a 66.90% interest in the the Heldeth Túé and Huskie deposits on the Waterbury Lake property in that province.
The stock fell 1.80% in the past week but has leaped 7.89% in the past month, 19.71% in the last three months and 38.98% for the last 12 months.
Chart courtesy of www.stockcharts.com
Sprott Physical Uranium Trust: Alternative to Three Uranium Investments to Purchase
Sprott, of Toronto, launched a new uranium product on July 19, 2021, called Sprott Physical Uranium Trust (TSX: U.U). The trust invests and holds substantially all its assets in uranium in the form of U3O8.
Sprott has bought more than 50 million pounds of uranium on the open market to speculate on the price of uranium for its investors. The company ranks as the world’s largest physical uranium fund, according to Morningstar.
“I have a pretty big personal stake in [the trust],” Melbye told me. Melbye’s holdings may not be much when compared to all the total shares outstanding, but he has proverbial “skin in the game” with his stake.
Since last July when the trust came into existence, the price of uranium has surged from $30-$40 per lb. last year to almost $60 per lb.
“Nuclear is carbon-free energy,” Melbye said. “Now, Democrats and Republicans both agree they like nuclear energy.”
The trust’s stock price fell 2.02% in the past week but zoomed 20.80% in the last month and 37.69% in the past three months.
Three Uranium Investments to Purchase for Income and Profits Aided By U.S. Policies
The three uranium investments to purchase should be helped by the U.S. government’s previously announced goal to cut up to 52% of its greenhouse gas emissions by 2030. At the same time, global demand for nuclear power is rising, as more countries commit to net-zero carbon goals, Melbye said.
The U.S. government further has taken action to ban imports of Russian oil, liquefied natural gas (LNG) and coal, but four Republican U.S. senators introduced legislation asking for uranium to be added to the list. Both Wyoming Sens. John Barrasso and Cynthia Lummis joined with Sens. Kevin Cramer, of North Dakota, and Roger Marshall, of Kansas, Thursday, March 17, to submit a bill to ban Russian uranium imports.
In the U.S. House, Congressmen Pete Stauber (R-MN), Adrian Smith (R-NE), Vicente Gonzalez (D-TX) and Henry Cuellar (D-TX) introduced legislation on Friday, March 25, to ban imports of uranium from Russia. The United States purchased more than 34 million pounds of uranium from 2016-2020, the Energy Information Administration estimated.
“It’s more important now than ever for the United States to achieve mineral dominance to secure our energy supply chain needs,” Rep. Stauber said. “By banning uranium imports from Russia, we can stop funding for Putin’s brutal war against Ukraine, create jobs for American workers and secure our national defense.”
As Putin continues his invasion of Ukraine, the United States must curb its reliance on Russia for resources and critical minerals, Rep. Smith said. America has the capacity to safely produce uranium domestically, rather than buy it from Russia and fund its war on Ukraine, he added.
FDA Approves Second COVID-19 Booster Vaccine; U.S. Cases Top 80.1 Million
The U.S. Food and Drug Administration announced on March 29 the expansion of its emergency use authorization for the Pfizer and Moderna COVID-19 vaccines to be received as a second booster shot by adults who are 50 and older. That second booster shot could come as soon as four months after the initial booster dose.
The move provides an additional safeguard to protect against the virus that could boost business activity and the economy further in the months ahead. The second booster would enhance protection for healthy older adults.
COVID-19 also has led to a new, highly contagious subvariant of Omicron, BA.2, that has spread a rising wave of infections in Europe. China is enduring its worst outbreak since the virus initially surfaced in Wuhan. COVID cases also are on the climb in European countries such as Germany, the Netherlands and Switzerland.
COVID-19 deaths worldwide exceeded 6 million to total 6,147,539 on April 1, according to Johns Hopkins University. Cases across the globe have soared to 489,206,989.
U.S. COVID-19 cases, as of April 1, hit 80,137,716, with deaths rising to 982,298. America has the unenviable status as the nation with the most COVID-19 cases and deaths.
As of April 1, 255,582,575 people, or 77% of the U.S. population, have obtained at least one dose of a COVID-19 vaccine, the CDC reported. Fully vaccinated people total 217,703,007, or 65.60%, of the U.S. population, according to the CDC. In addition, 97.8 million people have received a booster dose of COVID-19 vaccine, up about 400,000 in the past few days.
The three uranium investments to purchase for income and profits offer two funds and a stock seeking to provide exposure to the rising value of an increasingly precious commodity fueled by favorable U.S. government policy and legislation. Despite Putin’s perplexing actions that are killing thousands of Russia’s own soldiers and Ukrainian men, women and children, the attacking nation’s ruses plotted by Putin and scant progress in peace talks suggest an end to current hostilities is far from done.
Paul Dykewicz, www.pauldykewicz.com, is an accomplished, award-winning journalist who has written for Dow Jones, the Wall Street Journal, Investor’s Business Daily, USA Today, the Journal of Commerce, Seeking Alpha, GuruFocus and other publications and websites. Paul, who can be followed on Twitter @PaulDykewicz, is the editor of StockInvestor.com and DividendInvestor.com, a writer for both websites and a columnist. He further is editorial director of Eagle Financial Publications in Washington, D.C., where he edits monthly investment newsletters, time-sensitive trading alerts, free e-letters and other investment reports. Paul previously served as business editor of Baltimore’s Daily Record newspaper. Paul also is the author of an inspirational book, “Holy Smokes! Golden Guidance from Notre Dame’s Championship Chaplain,” with a foreword by former national championship-winning football coach Lou Holtz. The book is great as a gift and is endorsed by Joe Montana, Joe Theismann, Ara Parseghian, “Rocket” Ismail, Reggie Brooks, Dick Vitale and many others. Call 202-677-4457 for multiple-book pricing.