Plus, it’s important to understand that US utilities will have no issue with paying higher uranium prices!
You see, uranium is incredibly cheap relative to the overall cost of building and operating a nuclear power plant. In essence, uranium is a necessity but only a tiny portion of overall nuclear power costs.
Uranium could literally rocket tenfold... and it still wouldn’t have much of a cost impact on overall nuclear power plant operations. Hence, US utilities will have little problem, and, more importantly, zero choice over shelling out US$50/lb, US$100/lb, or however high uranium rises... as long as the U3O8 keeps flowing.
The case for massive profits from select US uranium stocks is clear...
Nuclear power is the world’s largest source of clean energy — greater than all others combined. America’s utilities are the world’s largest market for U3O8 — utilizing more than a quarter of the world’s uranium supply.
As the price of yellowcake surges higher, a small group of uranium-focused companies will have a virtual monopoly on this demand.
And that brings us to Uranium Energy Corporation — currently undervalued below US$3 per share and rapidly elevating its profile as America’s next domestic uranium producer.
A Clear Path to Uranium Stock Profits
There are several ways for individual investors to participate in the coming uranium boom... from the junior explorers, to the mid-tier producers, all the way to the majors.
We’ve been paying special attention to the juniors — such as Uranium Energy Corp. (NYSE-American: UEC) — because that’s where the largest percentage gains can be made in the shortest amount of time.
UEC has taken a number of well-timed measures to position itself as a future low-cost domestic uranium producer in a rising U3O8 market.
Management has spent considerable time and energy getting permits in-place for its low-cost ISR uranium projects, which means it is poised to move swiftly toward production as U3O8 prices continue to trend higher — ideally north of US$50 per pound in short order.
TRANSLATION: Uranium Energy Corp. — currently trading well below US$3 per share — is one of only a handful of publicly-traded US uranium exploration and development companies with the capability of attaining near-term domestic U3O8 production.
Additionally — as part of a process that commenced in Q1 2021 — UEC is brilliantly taking direct advantage of the current low uranium price environment by entering into contracts to purchase a total of 1.4 million pounds of U3O8 at a volume-weighted average price of approximately US$30 per pound with various delivery dates out to June 2023.
As noted, the price of yellowcake is trending upward — currently north of US$32/lb — which means the value of UEC’s growing inventory of US-warehoused uranium is also on the rise.
In addition to strengthening the company’s balance sheet, this direct uranium purchase initiative should also lend accretive support to UEC’s future marketing efforts with utilities as a means of accelerating future cash flows.