Nuclear Power Is the Energy Story of the Decade. This Stock Is Built to Last.

Nuclear power isn't new technology; we've had nuclear plants since the 1950s. But for various reasons both political and practical, it didn't catch on in much of the world. Only France derives a majority of its electricity (about 70%) from nuclear energy.

But that has been changing for a couple of years now, and the closure of the Strait of Hormuz has likely changed the equation for many countries already working to expand their nuclear capacity and should accelerate the nuclear renaissance.

That renaissance is global and will be playing out for years to come, and one companyis at the center of it all. Now is the time to consider adding it to your portfolio.

Image source: Getty Images.

Uranium fever

Based in Canada, Cameco (NYSE: CCJ) is the world's second-largest uranium miner and by itself was responsible for 15% of the 164 million pounds of uranium produced in 2025. It was behind only Kazakhstan's state-run Kazatomprom at 20% of world production.

Cameco's key advantage as a uranium miner is the quality of its assets. The company's two main mines are McArthur River/Key Lake and Cigar Lake, both in Canada. Both mines have very high-grade ore with more uranium present in it than most others.

McArthur River is the world's largest high-grade uranium mine with an average grade of 6.48% and enough uranium to keep producing until 2044. Cigar Lake is an extremely high-grade mine with an average grade of 16.33% and enough uranium to continue producing until 2036.

Cameco is continuing to explore the Athabasca Basin in Canada for more high-grade uranium deposits.

But Cameco does far more than just mine uranium ore. It also converts some of that ore into usable fuel through its Blind River Refinery and Port Hope Conversion Facility.

Lastly, Cameco is involved in the engineering of new nuclear reactors through its 49% share in Westinghouse. The engineering company is behind the AP1000 reactor, the most advanced nuclear reactor on the market today.

It's in high demand as well. China has 14 AP1000s under construction, India has selected six of them; Poland, Ukraine, Czechia, and Bulgaria have all contracted for two or more AP1000s, and the U.S. has 10 of them planned.

In all, it makes Cameco one of the best all-in-one nuclear fuel plays on the market today. And, with the Hormuz closure, Cameco looks like the right company in the right place at the right time.

The Hormuz crisis

The fragility in global energy markets right now is due to a few critical choke-points in the world's oceans. The Strait of Hormuz between Iran and Oman is one of the biggest, and certainly the one the world is focused on right now, as the Iranian government has closed it to ship traffic due to the ongoing conflict between it, the U.S., and Israel.

About 20% of all the world's energy moves through the strait in the form of oil or natural gas. The countries most affected are in Asia. Pakistan imports 81% of its energy through the strait, Japan imports 57%, South Korea 55%, India 50%, and China 35%.

Many of those countries, along with the U.S. and a number of European countries, have already been working to use more nuclear energy. But if it has done nothing else, the closure of the strait has laid bare the fragility of global energy markets.

And as a result, I think you will see many countries doubling down on their nuclear efforts in the coming decades. China already has about 30 nuclear plants under construction and began building two more in January of this year.

India has 24 reactors running and eight under construction right now. South Korea has 26 operational nuclear reactors and earlier this year announced plans for two new ones to be constructed by 2028.

Japan is working to bring its considerable nuclear reactor fleet back on line as memories of the Fukushima disaster fade. Poland plans to bring its first nuclear plant on line by 2036, and the U.S. is planning to triple its nuclear power generation by the middle of the century.

Profits gone nuclear

And, with uranium experiencing a 30% price increase over the past year, you might expect Cameco is doing pretty well for itself. Your expectation would be correct.

Revenue for the whole of 2025 came in at $3.48 billion, up 11% over 2024. On the back of that, Cameco's earnings per share (EPS) surged 114.9% over 2024.

Despite the capital-intensive nature of mining as an industry, the company still manages a net profit margin of 16.93% and has a very healthy balance sheet. At present, its debt-to-equity ratio sits at 0.14.

Now, as a mining company, Cameco is at the mercy of uranium prices. However, there is a shortage of the spicy yellow rock on the horizon. All the miners in the world, Cameco included, produced 164 million pounds of uranium in 2025. That equates to about 82,000 tons.

Now, at present that's a healthy surplus. According to the World Nuclear Association, all the world's nuclear reactors need about 69,000 tons each year. However, due to the huge numbers of reactors under construction globally, the World Nuclear Association projects those needs will grow to 150,000 tons by 2040. The low-ball estimate is 107,000 tons which still outstrips current production by 30%.

It also takes years to bring a new mine online. It varies by location and method but a conventional mine takes 3-7 years to begin producing.

So, I don't see demand slowing or the price of uranium dropping dramatically anytime soon with the growth in interest in nuclear power, and by extension, nuclear fuel. And with Cameco already standing as the second largest uranium miner in the world it has a significant head start on smaller miners looking to ramp up production.

Cameco has proven it can reliably supply uranium long-term. That's likely to make it the first choice for countries that don't want to deal with Russia or Kazakhstan. For example, in early March, Cameco signed a $1.9 billion supply deal with India that will see it supply 22 million pounds of uranium ore concentrate to the country's nuclear energy program between 2027 and 2035.

Given that India is planning to build some AP1000 reactors, there's a good chance that one day, Cameco's uranium will be fueling its own reactors in that country.

Despite tumult in the Strait of Hormuz causing the S&P 500 to tumble over 6% this year, Cameco is up 17.46% year to date and 161% over the past 12 months. It has serious momentum and the financials to back it up. This is one way to invest in a huge portion of the nuclear renaissance with a single stock.

James Hires has positions in Cameco. The Motley Fool has positions in and recommends Cameco. The Motley Fool has a disclosure policy.