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A Low-Risk Entry Into A Hated Sector: The Uranerz Takeover

Despite our long-standing interest and close watch of uranium-related investment opportunities, we have been very reluctant to make investments in this sector so far, and in actual fact, have been holding only one single uranium mining stock throughout 2014. And lo and behold, our investment thesis for this stock has just become much stronger, and we are adding to our position. This article explains why.

Uranerz (URZ) has bucked the multi-year post-Fukushima downtrend in the sector, and has commenced uranium mining from its facilities in the Powder River Basin in Wyoming in mid-2014. Highly promising results for the first quarter of commercial production have not gone unnoticed, and on January 5, a friendly takeover bid by fellow uranium junior miner Energy Fuels (UUUU) was announced. The market barely flinched, and thus an attractive entry point has been created, as we will explain in due course.

We believe that Uranerz currently… Read More …