NEW YORK (TheStreet) -- An "ugly duckling" stock can turn into a "swan" while few are noticing. What investors want to avoid are the "Black Swans," but I think we should embrace all swans as long as they don't lead to a "swan song."
One emerging swan is Cameco, , one of the crown jewels of the nuclear-energy realm.
Cameco wants to remain a dominant nuclear-energy company by increasing its annual uranium supply to meet growing worldwide demand.
Much of the world still depends on nuclear energy for electrical power, and the Environmental Protection Agency calls nuclear energy a "clean energy" and a reliable source.
According to the Department of Energy, nuclear power accounts for about 20% of electricity production in the U.S. and more than 100 nuclear generating units are in operation in the country. The EPA says uranium is an essential element to nuclear power.
Nuclear power is still a controversial subject and exceeds the scope of this article. My point is that uranium keeps the process going.
The Fukushima, Japan disaster that followed the major earthquake off the coast of Japan in March 2011 triggered worldwide fears about the safety of nuclear-power plants. That in turn caused the cancellation and closures of plants in Europe and the U.S., and led to a meltdown in uranium mining and producing stocks which can be seen in this five-year chart of Cameco. CCJ data by YCharts
After Fukushima, shares of Cameco plunged from around $43 to below $17, although the trailing 12-month (TTM) revenue per share continued to rise. As you can see on the chart above, it has had two spikes higher, while Cameco shares have traded in a narrow range over the past 12 months.
Of course, the best time to buy shares of a profitable company is near the lows. Let's zoom in on how shares have performed in the past year by looking at a one-year chart which includes quarterly revenue per share. CCJ data by YCharts
The 52-week low of $16.41 was established in November 2012, and since then, shares have climbed more than 41% to their 52-week high of $23.23.
The stock is still trading above $21 despite Cameco's dismal first-quarter results. Revenue fell 4.7% to $2.34 billion, and earnings per share tumbled 94% to 37 cents. Those numbers sent the stock down from $23 to below $18. Since then, it's been steadily moving higher.
That's partly due to Cameco's announcement last week that it received a uranium mining license for the Cigar Lake Mine in Saskatchewan, Canada. The mine contains the largest undeveloped high-grade uranium deposit in the world.
One big question is what kind of numbers Cameco will deliver when it reports its second-quarter results in July. Analysts estimate EPS and revenue will each rise 44%. If Cameco doesn't fall below those estimates, and with the Cigar Lake project licensed and ready, shares may soon move sharply higher.
My plan is to keep an eye on the company's website. The company is likely to give more guidance as it approaches its next earnings report date.
Cameco is a stock that can morph from an "ugly duckling" to a "glorious swan" and back again more than once during the course of a year. That could indicate a chance soon to buy lower than at current levels.
A prudent approach is to buy a little on the next dip and wait until more news unfolds in the weeks ahead to buy your second helping. Keep in mind Cameco is in my opinion "best-in-breed" among the world's uranium producers.
At the time of publication the author had no position in any of the stocks mentioned.
This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.