At the onset of The 10-Minute Millionaire, I told you we were embarking on this journey together – not just as a team, but in a unique partnership.
I meant what I said.
And I want to prove it to you.
You see, my sole mission is to help you change your life and start you down the path to millionaire status.
Everyone here at The 10-Minute Millionaire is 100% focused on helping you build the fortune you’ve always longed for. Our job is to help you succeed.
We don’t succeed unless you succeed.
Fact is, I am committed to helping you build financial security – the kind of wealth that gives you the freedom to enjoy your life to the maximum, without money worries.
That’s why going through the messages that you send me is a central part of my daily routine.
I’ve been stunned (and gratified) by the rush of enthusiasm that’s followed our launch of The 10-Minute Millionaire – and how the comments section for each report comes to life with your suggestions, questions and expressions of gratitude.
Here’s one of the more frequent questions you’re asking: “Hey, D.R., are you still excited about our Cameco trade, even with its recent bearish movement?”
The simple answer is yes.
In fact, Cameco Corp. (NYSE: CCJ) – the largest pure-play uranium miner in the world – is still one of the biggest and best wealth plays in the market today.
Knowing that, let’s do two things today.
First, let’s dig into the recent pullback we’ve seen in this nuclear technology play…
Then, let’s break down exactly why I still see double- or even triple-digit gains from here…
Waking the Giant
When we first made the investing case for Cameco in our introductory The 10-Minute Millionaire report, we gave you our in-depth “Find the Extreme, Frame the Trade and Book the Profits”investment case for the company. If you missed that initial report, or want to review it again, you can check it out here.
My “take” on uranium differs from the conventional view: While most folks look at the material and see a coarse powder with a singular odor, I see something much more intriguing.
I see latent energy – the kind of energy that can power entire cities for decades. I see solutions – to problems created by other energy sources, like coal. I see answers – to questions about how the world will keep meeting the escalating demand for power.
In short, I see value – lots of value – for investors.
What we said in our initial report was that increasing demand and a supply “squeeze” would ignite uranium prices and lift them to new highs – carrying Cameco’s stock price with it.
However, recently uranium bears have used “ripped from the headline” stories to pull the stock – and the uranium market – lower.
The first shot in the arm for uranium came back in April when nuclear energy giant Westinghouse revealed its Chapter 11 filing.
After the news broke, analysts around the world were quick to pontificate that the slow death march for uranium had finally begun.
But here at The 10-Minute Millionaire, we knew better.
In a weekend update, we decoded those rumors and made the case that Cameco was going to brush this news off entirely.
And that’s exactly what happened.
After tumbling to $10.62 a share, Cameco quickly rebounded – eating our modest 2% loss at the time.
Then Cameco posted a bigger-than-expected quarterly loss, driving shares to a nearly five-month low despite having maintained its full-year guidance for deliveries and revenue.
This was a classic Wall Street overreaction to an earnings miss – nothing more than “nervous money” getting out of the stock even though the uranium sector has already started its recovery.
As 10-Minute Millionaires, we know not to sweat this recent pullback – to not fall prey to those “ripped-from-the-headlines” stories or our “nervous” emotions.
Manic Focus on Growth
For the past two years, the outlook for the uranium market has “gone nuclear.”
In 2016 alone, uranium prices surged higher – breaking the $23-per-pound price level – while long-term prices have edged past $33 per pound.
Plus, it’s a verifiable fact that the global nuclear-power business continues to grow.
In 2016, the world’s fleet of nuke plants went from 439 to 446.
According to Cameco, that number will increase to 456 in 2017.
And it’s only set to go up from there, with 60 reactors under construction around the world.
The International Atomic Energy Agency’s (IAEA) most realistic estimate is that 90 new nuclear plants will enter service around the world by 2030.
The growth story for nuclear power, much like the growth story for oil and natural gas demand, is centered in the emerging markets. Since the 1980s, global electricity consumption has tripled and is expected to more than double again over the next two decades.
And as those reactors come online, they will require the uranium that Cameco mines, which should finally lead to the reduction of the current supply glut and push uranium prices higher.
As the revival of nuclear power ramps up and demand for uranium kicks into gear, Cameco will be a key beneficiary.
But let’s say, for some reason, those nuclear power plants never come online – which is highly unlikely, mind you.
Cameco still has the fortitude to stick around and deliver profits to its investors.
You see, Cameco does business a little differently than its rivals. Its business is built on long-term contracts.
Speculation aside, Cameco holds the leading net order for uranium among miners with a backlog of contracts worth more than $46 billion.
For its long-term uranium contracts, Cameco has nearly 200 million pounds of uranium orders on its books through 2019.
That’s more than six times the amount of uranium it sold in 2015.
By that point, new construction of nuclear power plants should push demand beyond supply and, with any luck, lead to higher uranium prices.
The Bottom Line: Cameco is big and well-run enough to easily survive today’s market because of its contract-focused business. Most of the other companies selling uranium today don’t have the same scale it has.
A Systematic Approach
Fact is, this trade stands to be a big moneymaker for us.
I believe that the long-term recovery in uranium prices is destined to be so significant that this has quickly become my favorite long-term trade idea.
However, because this is a long-term trade, the watchword here is patience.
Fact is, in auction markets, emotions can outweigh all other factors in determining the price of a stock as investors vote with their heart and money, not their heads.
There’s a scene in the 1987 flick Wall Street where financier Gordon Gekko (Michael Douglas) tells his young protégé, Bud Fox (Charlie Sheen), that the “first lesson in business is don’t get emotional about stocks – it clouds your judgment.”
All his misdeeds aside, Gekko was right on the money about the risks posed by letting your emotions guide your investments.
The reality is, though, that 95% of investors do let their emotions cloud their judgment.
And that’s why they get such lousy returns.
As aspiring millionaires, we know this is a fact – and we’re going to use that to our advantage.
Our system turns the tables on the market and profits from investors whose lack of preparation, lack of patience and lack of emotional control get them to buy when they should be selling, and sell when they should be buying.
Thanks to our system, we 10-Minute Millionaires gladly take the “other side” of those ill-advised trades, reaping the exponential profits that roll in from them.
And that’s exactly what we’ve done with Cameco.
Now, any trade carries some risk.
Uranium mining stocks are very volatile (meaning that, even when they’ve established a clear directional trend, they tend to gyrate above and below the “trend line” they’re following).
Which is where our “emotionless” system comes into play.
Knowing when to sell – to maximize profits and minimize losses – is where so many investors get tripped up. The 10-Minute Millionaire solves that problem by removing emotion from the process and putting it on “autopilot.”
On this trade, protection for our capital comes via a stop-loss set 30% below your entry price. This contingency exit minimizes the potential downside. But it also makes sure we don’t get shaken out of this trade by Cameco’s normal volatility – and miss out on its hefty upside as a result.
We’ll look to book profits on half of our shares once we’ve got a 60% gain – and then we’ll let the second half of our Cameco stake run until we have a 140% profit.
That would give us a combined profit of 100% – a great initial step on the journey toward your first million.
D.R. Barton, Jr.