If the oil sands wreak environmental controversy in Canada’s west, uranium deposits and uranium production can fare no better. Regardless, uranium producers are in demand and there will be investors, just like you are probably already an unwitting investor in some rather more obvious and one-sided sin stocks through your employer’s pension plan or a broad-market ETF.
For those considering breaking out on their own into individual companies, here is a list of some of Canada’s central uranium producers.
Top 5 Canadian Uranium Stocks By Market Cap and Trading Volume
All values based on TSX closing prices as of Friday, Sept, 11, 2009.
Cameco (TSX: CCO) – By far Canada’s largest (also the largest in the U.S.), but also one of the world’s largest producers of uranium and pillar of the nuclear energy industry. As an added bonus, some investors will be interested to know they are also expanding into gold production and have projects in Kazakhstan. Market Cap: $11.9 billion. Volume: 941K. Yield: 0.8%
Uranium One Inc. (TSX: UUU) – Also listed on the JSE (Johannesburg), Uranium One has a 70% stake in a Kazakhstan producer and is working in partnership with another team developing a second project in Kazakhstan. They also own projects in South Africa, Texas and Wyoming. Market Cap: $1.1 billion. Volume: 9.6M. *No dividend.*
First Uranium Corporation. (TSX: FIU) – First Uranium, like Cameco, is also a gold producer. This company has uranium and gold mines in South Africa. For social-equity interested investors, take note of First Uranium’s participation in the Black Economic Empowerment initiative (”BEE”) for racial integration in the South African economy. Market Cap: $592.2 million. Volume: 2.2M. *No dividend.*
Denison Mines Corp. (TSX: DML) – Denison is a diversified and intermediate-size uranium producer with three active mines in the U.S. and interests in uranium mills in Saskatchewan and Utah. Denison also owns development properties in Zambia and Mongolia. Denison is also the manager of the Uranium Participation Corp. (below). Market Cap: $570.7 million. Volume: 1.1M. *No dividend.*
Uranium Participation Corp. (TSX: U) – Managed by Denison Mines (above), this is primarily an investment holding company focusing on uranium concentrates and uranium hexafluorides. Possibly the purest way to play uranium. Market Cap: $548.5 million. Volume: 282.6K. *No dividend.*
Note the wide variance in market cap and trading volumes: market cap can remain relatively stable while trading volumes can move wildly up and down depending on many factors. So Cameco is the largest company here, but was barely traded at all in the last session. FIU was most-traded but less than one-tenth the size of Cameco. At the extreme end, Uranium Participation Corp. is the smallest company here and traded the least, too.
I can’t give an analysis here of what causes the difference in these trading volumes, but they change everyday and might depend on factors specific to the company itself, such as what we recently saw in the wake of Barrick Gold eliminating its hedging program.
Note also that Cameco is the only company above that pays a dividend.
Uranium may be a scary substance, but it is 40 times more likely (if you were to prospect on your own) that you will happen upon a uranium deposit than a silver deposit. And it is 500 times more likely you would find uranium than gold. Consider the amount invested in gold production around the world, and it puts into perspective the potential that uranium can have for the world’s energy needs.
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