Why not?
The numbers were good, and I still believe in the uranium thesis, the risk of CCJ’s management being dicks notwithstanding. I have no evidence of malfeasance; only the hairs on the back of my neck (and they’ve been wrong before, though rarely).
So I added to CCJ at $19.30.
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Looking back 2 quarters ago you can see the same pump and dump in Cameco stock price as this quarter. That was quickly followed by a strong rally. With earnings so good this quarter I think we will get a similar rebound.
In addition to the numbers, have you re-approached the thesis? Frankly, it feels, subjectively, like a lot of large energy markets are seeing continued weak demand. There’s price inflation in sub-sectors of the energy services sector, but there’s also total price destruction – not sure where nuclear and fuel fits in. From a macro perspective, is Russia going to dump uranium to make up for Ukrainian weakness?
Well from the bottom up:
(1) Russia dumping material would benefit CCJ, since they control the brokerage market
(2) Published price destruction is one thing, but there’s no volume around these trades and, at least on the face of it, Cameco swears they’re selling more uranium (presumably to consumers and not some off balance sheet entity) at higher prices. That makes demand hard to gauge
(3) I still see nuclear power being the base line of choice for global power production. If the world is serious about letting Africa, the Middle East, South and Central America’s, and Asia all convert to the US/Europe lifestyle, then there needs to be serious upgrades to power. And if climate change is going to be treated as a serious threat, then that severely impacts the options moving forward. Even with widespread adoption of solar or wind, you need a baseline, and nuclear is the only choice that fits the bill, globally to that scale.