Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, uranium producer Cameco
With that in mind, let's take a closer look at Cameco's business and see what CAPS investors are saying about the stock right now.
Cameco facts
Headquarters (founded) |
Saskatoon, Canada (1987) |
Market Cap |
$11.1 billion |
Industry |
Coal and consumable fuels |
Trailing-12-Month Revenue |
$2.18 billion |
Management |
CEO Gerald Grandey (since 2003) CFO Kim Goheen (since 2004) |
Return on Equity (average, past 3 years) |
12.3% |
Cash/Debt |
$1.29 billion / $1.05 billion |
Dividend Yield |
1.5% |
Competitors |
BHP Billiton
Rio Tinto |
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 97% of the 1,659 members who have rated Cameco believe the stock will outperform the S&P 500 going forward. These bulls include All-Stars TMFDeej and TSIF, both of whom are ranked in the top 1% of our community.
Earlier this week, TMFDeej tapped Cameco as a timely opportunity: "70% of incremental uranium demand comes from China. This is a bet that despite the terrible Japanese disaster nuclear power does not go away."
In fact, Cameco now sports a price-to-tangible book of 2.1. That represents a clear discount to listed competitors BHP (4.5) and Rio Tinto (4.3), as well pure uranium plays such as Uranerz (8.2) and Uranium Resources
CAPS All-Star TSIF elaborates on the contrarian bet:
The overall premise for "voting up" a uranium producer is that Cameco Corp is the most solid play with actual revenues and long term orders. I really don't think that the issues in Japan will affect third world country buildout of nuclear power, particularly India and China. Overall, the plants in Japan were 40 years old and technology and "lessons learned" should help "sell" nuclear power in countries with growing power needs and less input from "citizens". I do think this issue may have slowed the chances that the US would move toward new nuclear plants. It was a nice play for growth with Obama and the price of oil/issues in oil producing countries. I think the sell-off was mostly the "hope" of long term expansion in the US and Europe. The current pricing is still applicable for current needs.
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