I'll give this to you straight: As sure as I am that nuclear energy is becoming a key source to meet the growing energy demand, both in America and around the world, I'm not finding a whole lot of nuclear stocks that are a good buy right now. Ever since Constellation Energy announced its big re-opening of the Three Mile Island plant to power data centers for Microsoft in 2024, investor interest in this sector has skyrocketed. At this point, most nuclear stocks' valuations have all gone up so much that it's now incredibly hard to find any bargains.
But if there's any nuclear stock still worth buying, it's probably Cameco (CCJ +0.63%).
Image source: Getty Images.
What is Cameco?
Headquartered in Saskatoon, Canada, Cameco describes itself as "one of the largest global providers of the uranium fuel needed to power a secure energy future." The company boasts a controlling stake in "the world's largest high-grade reserves" of uranium, and mines uranium at a "low cost" of less than $46 per pound in total costs in 2025, versus a spot price for uranium of more than $85 per pound currently.
Cameco also owns a 49% stake in nuclear power plant designer Westinghouse Electric Company and in uranium enrichment company Global Laser Enrichment, according to data from S&P Global Market Intelligence.
Cameco divides its business into three major segments. The Westinghouse stake is the biggest, contributing $1.8 billion in revenue year to date -- but that's from a subsidiary. Cameco proper gets most of its money -- $1.3 billion in the first nine months of 2025 -- from mining uranium, and also buying and reselling it from other miners. Refining and enriching uranium contributed a further $279 million over nine months.
After netting out "unallocated adjustments," Cameco generates about $2.2 billion in annual revenue. The profit margin on this revenue was only 8% pre-tax last year, but has leapt to 23% so far this year.
Cameco versus the competition
That's an impressive number, 23%. Fact is, in contrast to some of the perhaps more exciting, momentum-driven uranium mining start-ups, Cameco is one of the few companies in the nuclear power industry today that's actually earning a profit from doing what it does.
It may not be a lot of profit. Valued in excess of $50 billion, Cameco earned less than $378 million over the last 12 months, giving it a trailing price-to-earnings ratio of 134. But among its rivals, Uranium Energy, Energy Fuels, and even Denison Mines all have no profit whatsoever.
Free cash flow at Cameco is even more impressive, nearly doubling reported net income at $698 million. That drops the company's price-to-free-cash-flow ratio into the double digits, at 72. And crucially, with profit margins expanding, analysts posit Cameco will attain the highest growth rate of any company in this industry over the next five years: 75% annual growth.
And that puts Cameco's price-to-FCF-to-growth ratio under 1. (With minimal net debt, furthermore, the company's enterprise value-to-FCF-to growth ratio is likewise under 1.)
NYSE: CCJ
Key Data Points
Cameco status report
Cameco last reported earnings in November, so a new earnings report lies just around the corner. Based on the latest report, though, things are looking good for this uranium mining stock.
Cameco CEO Tim Gitzel said "performance across our uranium, fuel services, and Westinghouse segments" was "strong" in the third quarter, and "nuclear continues on a path toward robust expansion" worldwide. The Westinghouse division, in particular, is expected to benefit from a planned $80 billion investment in building large nuclear power plants in the United States, probably based on the Westinghouse AP1000 plant design.
Westinghouse is the company's biggest business. If profit margins also hold up in its second biggest business, uranium mining and selling -- and given the near-100% difference between cost of production and retail prices, they should -- Cameco stock appears to be headed for a bright future.
Admittedly, a lot depends on Cameco hitting the very aggressive earnings growth target of 75%. But if Cameco can do that, then even 72 times trailing free cash flow shouldn't be too high a price to pay for this crucial element of the nuclear supply chain.
