Here’s Why Cameco Corporation (CCJ) Outperformed in Q2
Aristotle Capital Management, LLC, an investment advisor, released its “International Equity Strategy” second quarter 2023 investor letter. A copy of the same can be downloaded here. In the second quarter, Aristotle Capital’s International Equity strategy returned 4.99% gross of fees (4.87% net of fees), outperforming the MSCI EAFE Index’s 2.95% return and MSCI ACWI ex USA Index’s 2.44% return. The portfolio's outperformance in comparison to the Index can be traced mostly to securities selection, however, allocation effects also had a favorable impact. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.
Aristotle Capital’s International Equity strategy highlighted stocks like Cameco Corporation (NYSE:CCJ) in the second quarter 2023 investor letter. Headquartered in Saskatoon, Canada, Cameco Corporation (NYSE:CCJ) is a uranium producer that operates through Uranium and Fuel Services segments. On August 30, 2023, Cameco Corporation (NYSE:CCJ) stock closed at $36.94 per share. One-month return of Cameco Corporation (NYSE:CCJ) was 9.55%, and its shares gained 29.39% of their value over the last 52 weeks. Cameco Corporation (NYSE:CCJ) has a market capitalization of $16.015 billion.
Aristotle Capital’s International Equity strategy made the following comment about Cameco Corporation (NYSE:CCJ) in its second quarter 2023 investor letter:
"Cameco Corporation (NYSE:CCJ), the world’s largest publicly traded uranium producer, was the top contributor during the period. Over the past year, there has been a rise in support from governments and policymakers for nuclear energy as countries realize it can play a crucial role in lowering dependence on fossil fuels to meet environmental pledges and goals. In addition, Russia’s war in Ukraine had led to an increase in the price of competing carbon fuels and heightened attention on energy security. Although such global market dynamics have likely favored Cameco in the short term, we believe the company will benefit long term from its financial discipline and advantaged assets. (Its Canadian mines—Cigar Lake and McArthur River/Key Lake— produce some of the world’s highest‐grade uranium.) Cameco has also slowly ramped up production while obtaining long‐term contracts. As such, in 2022, Cameco signed a record number of long‐term supply contracts and conversion services (where yellow cake is processed and readied for enrichment operations). This success has continued into 2023, with Cameco having recently secured an additional 12‐year contract with Energoatom, Ukraine’s state‐owned nuclear energy company, as well as a 10‐year agreement with Bulgaria. Central and Eastern Europe are new markets for Cameco, and this supports our belief that the company is well‐positioned to win new business in the regions that were historically dominated by Russia. Moreover, we look forward to Cameco’s planned acquisition of Westinghouse Electric Company (expected to close during the second half of 2023), as we believe Westinghouse’s market‐leading downstream capabilities will align well with Cameco’s production and fuel services to offer a highly competitive nuclear fuel solution."
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Cameco Corporation (NYSE:CCJ) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 54 hedge fund portfolios held Cameco Corporation (NYSE:CCJ) at the end of second quarter which was 49 in the previous quarter.
We discussed Cameco Corporation (NYSE:CCJ) in another article and shared the list of best 52-week high stocks to buy. In addition, please check out our hedge fund investor letters Q2 2023 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
