For Immediate Release
Chicago, IL – December 16, 2011 – Today, Zacks Investment Ideas feature highlights Features: Shaw Group, Inc. , Energy Solutions (ES - Analyst Report) , Scana Group (SCG - Analyst Report) and Urranium Resources, Inc. (URRE - Snapshot Report) .
Nuclear Stocks at Historic Lows
"A low-nuclear future would also boost demand for fossil fuels: The net result would be to put additional upward pressure on energy prices, raise additional concerns about energy security and make it harder and more expensive to combat climate change."
So with the global energy picture becoming increasingly dire, the question isn't wether the world wants to live without nuclear, the question is can it?
If the answer to that question is no, then this is a good time to be looking at nuclear stocks. Because as Warren Buffet says, be greedy when others are fearful. And the market has clearly had a fairly emotional response to what happened in Japan, beating nuclear stocks into the ground while earnings held up much better. So let's go ahead and take a look at four stocks that will benefit from a rebirth in the nuclear story.
Top 4 Nuclear Stocks
Shaw Group, Inc. designs and builds nuclear plants and facilities and has a market cap of $1.6 billion. Shares have taken a beating over the last 8 months, falling from $44 to $23. But in spite of that downward pressure, estimates have held up pretty well, currently trading at less than 10X forward earnings. And with a PEG ratio of .6, SHAW is trading well below its medium PEG of the last 10 years of 1.4. So it could be a chance to step in and buy a stock that has a solid valuation while the rest of the market yawns with a lack of interest.
Energy Solutions (ES - Analyst Report) is a highly specialized company, offering waste transport and management services to the nuclear industry with a market cap of $256 million. ES has also been weak over the last 9 months, falling from over $7 to below $3. But with the next-year estimate calling for earnings of 32 cents, shares trade at just 9X forward earnings. And with barriers to entrance, this company also looks well insulated from competition.
Scana Group (SCG - Analyst Report) would be the most conservative nuclear play on our list, an electric utility that owns a few nuclear plants. The company has a market cap of $5.6 billion and solid 4.5% dividend. Shares are actually up over the last 9 months, most likely because of its dividend in the volatile market. Looking forward, with footprints in nuclear power generation, this company has the knowledge and infrastructure to be a leading player in the space.
Urranium Resources, Inc. (URRE - Snapshot Report) is a micro cap uranium miner, with a market cap of $75 million. But that belies the company's status in the uranium market, where it has one of the world’s largest supplies of the special ingredient required for nuclear energy production. Shares have been hammered, currently trading at just 80 cents, but with an all-time high over $15, this is a great high-risk, high-reward pick out of nuclear.
The market hates nuclear stocks right now, so act like Warren Buffet and be greedy when others are fearful.
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