A Big Upgrade for USEC

Every day, the sun rises on Wall Street, and a plethora of professional analysts wake to issue new opinions on stocks. Here at the Fool, we use our "This Just In" column to examine some of these picks -- and the track record of the firms behind them -- so individuals can make better investing decisions.

In addition to following professional banks, anyone can use Motley Fool CAPS to monitor the collective opinions of more than 105,000 investors, many of whom demonstrate better investing insight than published analysts do.

Enough top-performing CAPS investors have turned bullish on uranium enrichment company USEC (NYSE: USU  ) recently to upgrade it from the four-star rank it has held over most of the past six months to the top rank of  five stars. Understanding what's behind the higher favor is key, so it's nice to have nearly 1,000 investors giving their opinion on USEC in CAPS.

With shares plummeting 67% in the past year, seeing a community of investors get more bullish on USEC should rouse the curiosity of any investor. The fall of USEC had a lot to do with the rising costs of its gaseous diffusion process for enriching uranium, and subsequent delays in moving to a more efficient centrifuge-based enrichment technology. But shares have bounced back recently, as the outlook for domestic nuclear power improves and Fluor (NYSE: FLR  ) , McDermott International (NYSE: MDR  ) , and other contracted companies  move ahead with development of USEC's new process plants, including a $3.5 billion centrifugation plant being built in Ohio.

With America once again going nuclear, investors see opportunity in energy companies such as NRG Energy (NYSE: NRG  ) and Duke Energy (NYSE: DUK  ) , as well as those in the supply chain like uranium miner Cameco (NYSE: CCJ  ) and enricher USEC. Many investors see USEC simply caught up in near-term pessimism surrounding its process transition, and believe that the global move toward alternative energy will be a boon for nuclear players. With 95% of the 982 CAPS players rating USEC seeing it outperform the market going forward, many on Main Street think this stock just might be one that Wall Street is missing.

To see what the very best CAPS analysts are saying now about USEC -- as well as other winning stocks they are picking -- head over to CAPS and have a look. The community research and resources in CAPS are totally free, unlike analyst opinions reserved for paying clients.

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Fool contributor Dave Mock recently upgraded his pog collection from "flea market gem" to "eBay dream auction." He owns no shares of companies mentioned in this article. The Fool's disclosure policy lives by the rules, of course.


Read/Post Comments (3) | Recommend This Article (6)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On June 12, 2008, at 4:30 PM, eprobasco wrote:

    It's nice to see more good publicity for such a promising company. I could ramble on with lots to say, but so many investors have already done so on Fool.

  • Report this Comment On June 17, 2008, at 12:06 PM, WallaceRose wrote:

    Where are all the comments on USU? Does anyone know the date the government will release the funding for the new processing facility or am I mistaken? Is the government giving a loan to USU or is USU receiving approval to build the processing facility? Anyone know the answer or have the DATES?

  • Report this Comment On July 03, 2008, at 3:58 PM, stockjock43 wrote:

    Bigt upgrade huh? Well it was down to 4.80 a share so I dont know WTF is goioing on here. Mayeb financing is an issue now...I still like it at these levels as I expect uranium prices to clime significantly in the next 15 months...but I am holding for now and waiting for a clear bottom

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