Denison Mines (DNN)
I’m not a fan of mining stocks, as I’ve written in the past. But if investors want to take a stab at the sector, then small, developing miners traditionally offer the best chances for big gains. And Denison Mines (NYSEAMERICAN:DNN) fits that bill.
Denison’s properties are located in the Athabasca Basin, in northern Canada (Alberta and Saskatchewan). It’s targeting uranium resources at its properties — and uranium prices are starting to tick up. The closure of a mine by giant Cameco Corp (NYSE:CCJ) presents a near-term catalyst to those prices — and the discounted fair value of Denison’s mines.
Obviously, there is a ton of risk here. Denison is unprofitable, and likely will need to raise more capital down the line. But DNN actually could provide what mining stocks are supposed to: leverage to the price of uranium. With fundamentals perhaps supporting some upside in the metal, DNN could follow.
As of this writing, Vince Martin has no positions in any securities mentioned.
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