Insider Monkey

11 Best Uranium Stocks To Buy

Ramish Cheema
8 min read

In This Article:

In this piece, we will take a look at the 11 best uranium stocks to buy. If you want to skip our overview of the uranium industry, and an analysis of the recent trends, then read 5 Best Uranium Stocks To Buy.

Advances in manufacturing and technology have enabled humanity to manipulate materials in transformational ways to use basic materials such as sand for advanced purposes like high end computing. For instance, modern day lithography, which is the process of making semiconductors, uses light to print billions of circuits on refined silica sand and silicon dioxide. These semiconductors power the world in the form of chips present in laptops, notebooks, airplanes, and cars.

Another significant leap in materials manipulation is nuclear technology. Nuclear technology is the most efficient technology for generating energy, and it comes in two flavors. The first of these, and the most widely used, is the less energy intensive process called nuclear fission. Nuclear fission bombards radioactive materials with neutrons to make their atoms split and generate more neutrons. This creates a chain reaction that generates a massive amount of power. Estimates show that a gram of fissile material can generate a whopping one megawatt of electric power, enough to power 750 homes.

The second flavor of nuclear technology is nuclear fusion. Nuclear fusion 'fuses' two atoms together which leads to significant energy generation. However, since the energy requirements of this process are equally high, all of the electricity produced in the world's nuclear power plants is from nuclear fission. Nuclear fission plants use either uranium or plutonium as their fuel, with plutonium being significantly more powerful since less plutonium can be used to reach critical mass when compared to uranium.

However, uranium is more widely used since it is less radioactive and even safe to touch in its in active state. Uranium is also easily available, and its production and price are subject to the same constraints as any other commodity. For instance, during the coronavirus pandemic, global uranium production declined and the market became tighter particularly as the Sprott Physical Uranium Trust came online and bought a quarter of the world's triuranium octoxide, commonly known as yellowcake uranium. These purchases, coupled with the disruption ushered in by the Russian invasion of Ukraine and political turmoil in Kazakhstan caused uranium prices to soar to $63.75 in April 2022.

While most of the world's attention is often focused on solar and wind power for renewable and emissions free energy generation, the fundamental nature of these technologies leaves them vulnerable to the structure of the modern day energy demand. Global energy and electricity requirements require 24/7 continuous power, and higher wattage during peak hours. As an example, noon and afternoon are times of peak consumption during the summer; however, homes also require power at night. This segregates global power demand into two segments. The first is the base load i.e. power that must always be available, and the second is peak load, which is the greatest amount of electricity demanded.

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