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Oil, Gold, Copper, Silver- it's all any commodity player can talk about. However, there's another commodity the main stream media is ignoring. Why- I'll tell you why- It's because the big boys on Wall Street are accumulating their position before they let their secret out to the public through the talking heads of Wall Street media.
When Cramer goes on his Mad Money show and tells the suckers of the world it's time to buy Uranium and Uranium stocks, he will be acting as a puppet for the big boys who already own it cheaper than you. Where do you think these "journalists" get their stories? From Hedge Fund Managers with positions must cheaper. They use the Cramers of the world to create an exit strategy.
So- what is this forgotten commodity? Glad you asked- it's Uranium- nuclear fuel. A big run in Uranium was sabotaged in 2011 by the Japanese Tsunami- who could forget the imminent threat of a nuclear melt down in Japan? All of a sudden, the world lost its enthusiasm for building nuclear power plants. So, where is new demand coming from?
Coal is the only cheap commodity in China, and the Chinese are trying to reduce pollution and diversify into other forms of energy.
Mainland China currently has 14 nuclear power reactors in operation. 25 more are now under construction, and more are about to start construction soon.
Additional reactors are planned, including some of the world's most advanced, to give a five- or six-fold increase in nuclear capacity to at least 60 GWe by 2020, then 200 GWe by 2030, and 400 GWe by 2050.
This aggressive build out by the Chinese has led to massive new demand for Uranium for the foreseeable future.
Over the last two months Uranium has quietly sneaked up from $40 to $53- heading back toward's its high of about $110 per pound pre 2008.
Uranerz Energy is absolutely on fire. Coming off a severe low last October of $1.40, the stock recently ticked up to $2.85 and is looking higher nearly every day.
URZ has been drilling in Wyoming's prolific Powder River Basin. 6 uranium exploration holes were drilled to a total of 140,000 feet, with three drill rigs in place. On January 18th the company reported the best drill results to date from the nose area of the Nichols Ranch deposit that were even better than had been expected. URZ had resources of over 19 million pounds of U3O8 as of October 14, 2010.
According to a recent press release as it relates to their mining operations: " Construction is well underway and is currently on schedule. The Company's focus is on the construction of the processing plant, the office and laboratory, the maintenance facility, and the installation of monitor and production wells required for ISR uranium mining. Six drill rigs are engaged in production well installation."
This company is fully underway- mining and processing are in place, and the Chinese are knocking on their door.
Is it any wonder the stock is behaving so well?
A quick look at this chart shows me a stock that has traded nicely in 2012, but has a long ways to go.
URZ has been in a solid up trend since December as the price of Uranium started to surge once again.
URZ is owned by 10 large institutional holders, and 10 different mutual funds.
The stock is part of the Russell family of indexes- specifically the 3000, 2000, Global & Microcap.
URZ trades, on average, 517,000 shares per day, and as you can see the chart looks absolutely outstanding.
As demand for Uranium continues to expand, and URZ moves further down the road with harvesting Uranium from its Power River Basin operations, there's no reason this stock couldn't at least go back to its 2011 high of $6- before the Japanese Tsunami caused an unwarranted sell off in Uranium stocks.
I like URZ for at least $3.50 in the next week or two, and much higher levels over the coming months. This one is not just a trade- this is a good long term hold for your small cap, commodity oriented portfolio.
Uranium is the forgotten commodity. When Cramer is talking about this one again, you'll know it's too late. Accumulate while this one is still relatively under followed, then sell when Cramer tells everyone its safe to buy.