The Uranium Story You Haven’t Heard
...Barron’s piece inspired me to write to you today. As a long-term investor, I am not tempted — at all — by the apparent bargain in uranium stocks.
I want to preface what follows by saying I get the bullish case for uranium and nuclear power. I was a bull for a time and took positions in uranium stocks in February 2010, just before they started to lift.
“Trading as if the world is always poorly managed and you can’t figure it out is right almost all the time…”
The incident at Fukushima made me reverse course. We sold our uranium stocks in March 2011, shortly after the disaster. We took a 70% gain on Kalahari and saved a slim 7% profit on Paladin Energy. Kalahari got bought out and no longer trades. But Paladin, which I recommended selling at $3.29, is today 39 cents. In my Capital & Crisis newsletter, I also saved a 10% gain on Cameco and sold at $30. Today, it’s $20.
As good as the uranium story sounds, I think there are bigger reasons to avoid the stocks as anything other than trades.
First, because the disaster at Fukushima could easily have an Act II that could be worse than anything we’ve seen so far...
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