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If I’ve inherited two things from my uncle Rick they would be: a love for investment setups with a supply-lead crunch and a tendency to look for royalty and streaming Co.s operating within such a setup.
Today’s focus Uranium Royalty Co. (UROY) is a combination of both such ideas which to me, is a match made in heaven.
Before we dig in, I’d appreciate it enormously if you could share and re-stack this publication.
The Uranium Story- Macro backdrop.
Much ink has already been spilled by sector experts already so I believe it would be redundant to spend too much time on the macro and meso economic set up for Uranium as an investment thesis.
In a paragraph I would summarise it thus:
The global push for clean energy and the resurgence of nuclear power have created a bullish outlook for uranium. As governments worldwide pursue ambitious plans to reduce carbon emissions, nuclear energy is increasingly seen as a viable long-term solution. This shift, coupled with supply constraints and geopolitical tensions, has set the stage for a potential uranium bull market.
To really dig in to the minutiae I recommend the work of our friend
.Additionally, you can access the mind of my friend and industry specialist Justin Huhn on my youtube channel where you’ll find several hours of content explaining the set up.
But here’s the thing… I now dislike the Uranium miners, more specifically I’m disdainful towards the developers who appear to be hype machines and are unlikely to ever get into production this cycle. I first entered the space in Dec of 2020 and rode the likes of CCJ, KAP, BMN, BOSS and particularly DNN to some nice profits before selling out almost completely as I began to see the sector getting a bit over its skiis.
With the sector bell-weather Cameco currently trading at 42x Free cashflow (FCF), the other major Kazatomprom (KAP) having production issues and well, being situated in a tricky combination of latitude and longitude neither appeals to me right now.
The small (sub $1B) aren’t that inviting unless you’re underwriting ridiculously high AND SUSTAINED Uranium prices and of the mid tiers, the only promise of making money is likely Nexgen, however here of course, I’m referring to its board members who are making piracy fashionable again. Shareholders will be lucky to make any real long term profit here despite the enviable deposit they hold.
So how to play this?
How do I position myself to benefit from a shorter-term spot price squeeze + a long term profit stream form future mining contracts without the exposure to operational risk?
I’m about to tell you in this month’s deep-dive so subscribe today with your free trial to gain access immediately.
Ladies & Gentlemen,
Let’s dig in..
Investment Idea: Uranium Royalty Corp | UROY |
Executive Summary:
Uranium Royalty Corp (UROY) offers investors unique exposure to the uranium sector through its royalty and streaming business model. As the only pure-play uranium royalty company, UROY is positioned to benefit from rising uranium prices without direct exposure to operational risks associated with mining.
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