Why Energy Fuels Absolutely Soared This Week

Energy stocks just caught rocket fuel—and Wall Street's scrambling to catch up.

The Uranium Catalyst No One Saw Coming

Regulatory shifts suddenly made nuclear energy investments look like the smartest play in the energy sector. Traditional analysts missed the signals while institutional money flooded into uranium assets.

Supply Crunch Meets Geopolitical Spark

Production cuts from major mining operations collided with export restrictions from key regions. The perfect storm sent shockwaves through energy markets—proving once again that physical commodities can outperform algorithmic trading strategies.

Short Sellers Get Obliterated

Hedge funds betting against the sector faced catastrophic losses as buying pressure intensified. The squeeze demonstrated how quickly sentiment can shift when fundamentals align—a lesson Wall Street somehow needs to relearn every cycle.

Energy transitions wait for no one—not even analysts who still think oil barrels are the only game in town.

Government support goes a long way in this market

This week, the Trump administration made several positive comments and indications regarding both nuclear energy, which is Energy Fuels' Core business, and other strategic minerals.

On Wednesday, Energy Secretary Chris Wright gave a speech at the New York Press Center during a meeting of the United Nations, in which he reemphasized a focus on boosting nuclear energy. In the speech, Wright advocated for "common sense, grow more energy, focus on nuclear power, focus on natural gas -- by far the two biggest potential needle movers on greenhouse gas emissions."

Energy Fuels is the leading U.S.-based producer of uranium oxide, which is the first step in producing baseload nuclear energy. Therefore, it was no surprise to see Energy Fuels rallying on the heels of Wright's speech.

In addition, it was also reported the Trump administration is in talks to take a minority stake in lithium miner(LAC -13.50%). The administration has already taken equity stakes in certain mining companies in return for price floors and/or demand mandates from U.S.-based customers, with these strategic investees typically seeing their stocks soaring in response to these deals.

Then on Thursday, The Information reported that the U.S. government was also looking to take more equity stakes in other U.S.-based mining companies that mine critical materials. That sent shares of such companies, including Energy Fuels, skyward on Thursday, adding to this week's gains.

Image source: Getty Images.

Energy Fuels' valuation looks frothy, but it's hard to bet against

Energy Fuels has had a tremendous 229% gain this year, and it seems like the stock may in a speculative bubble. Shares trade at 16 times next year's revenue estimates and 140 times 2026 adjusted non-GAAP (generally accepted accounting principles) earnings per share estimates.

While that valuation seems bubble-like, Energy Fuels' revenue and profit trajectory is coming off of zero, so it's hard to estimate where "mature" revenues and profits will ultimately end up. Moreover, Energy Fuels has a unique asset in its WHITE Mesa mill, which is the only U.S. refiner with the capability of refining certain rare earth elements.

So Energy Fuels owns a geopolitically scarce asset, and its market cap is only $3.9 billion today, even after this year's gains. Therefore, while the stock seems expensive on near-term financials, there's also potential for more upside. Short-sellers, at least, should stay away.