Uranium, green energy of the future, sees surging demand. Uranium stocks poised for further growth

Why am I talking about uranium? Uranium stocks are looking increasingly bullish as we have now entered an upgrade cycle for the uranium sector, and companies; with banks, and ratings agencies upgrading the future clean energy source.

Who's upgraded the sector? Moody's, Goldman Sachs, Fidelity, and S&P Global Market Intelligence all recently upgraded the sector, as supply issues remain, yet demand for clean energy is rising, amid the AI and data centre boom which is somewhat demanding access to low-cost energy round-the-clock. This comes at a time when the uranium price has pulled back from its record and supply issues are likely to remain till 2040, which supports upside in the sector.

We know supply has been taken out of the market, by Kazatomprom, the world’s biggest uranium miner, who cut production guidance this year amid poor weather in Kazakhstan, where most of the world's nuclear fuel is produced.

What are the tailwinds for the nuclear energy generators? The US has introduced tax incentives for nuclear power generation. And demand is rising from householders and businesses for clean energy. S&P Global Market Intelligence' report suggests that AI and data centres demand is driving an insatiable appetite for lost cost energy many hyper scale large cloud service providers are offering computing and storage services at a massive scale and heavily rely on data centres as part of their core business.

Also keep in mind, the US, and Canada and Japan want to use nuclear power as their main energy source by 2050, as it' one of the cleanest forms of energy and requires fewer natural resources than other available forms.

Meanwhile, Goldman Sachs upgraded the sector with also noting that supply remains constrained as the US fails to lift production, while the US considers a ban on Russian supplies. Many countries are focused on making nuclear power as their clean energy source by 2050, to cut emissions. Goldman analyst Neil Mehta says global uranium demand could grow by 60% by 2040.

Also note, that Constellation Energy (CEG), has been the most upgraded stock over the last month, out of all the stocks in the S&P500 (bar one, Micron Technology). Constellation produced about 10% of all carbon-free energy on the US grid last year. 9% of its total generation comes from clean sources. Moody's also upgraded Constellation Energy as it is extending the lifespan of its nuclear fleet by 20 years\, which will create more additional carbon-free energy than all the solar and wind energy on the grid today.