This Growth Stock Continues to Crush the Market

Cameco (TSX:CCO) stock might be the best on-sale stock you pick up this spring season.

Key Points
  • Volatility is making markets feel worse than they are, so avoid panic selling and be ready to buy quality stocks during pullbacks instead of trying to time exits and re-entries.
  • Cameco is positioned as a long-term winner because AI data centers need more power, nuclear is a key source, and rising uranium demand can keep supporting the stock even after an ~18% dip.

The Canadian stock market is rolling over quite the tall roadbump, and there’s concern that more potholes could be on the road immediately up ahead. Regardless, volatility has been the new normal so far this year, and there isn’t all too much reason to believe that things will change anytime soon, especially amid rising geopolitical fears. With further rate cuts seeming more unlikely and critical hedges, like gold, not really behaving like the “safe-haven” assets that some investors may have bought them for, it’s a bit of an uneasy time.

Add the recent hit in bond exchange-traded funds (ETFs), especially the funds with bonds of longer duration, into the equation, and it feels like the sky is falling all over again, just like it did way back in 2022. Of course, things could easily get worse than the plunges of 2020 or 2022. But, at the same time, maybe this is just another correction that’s to be expected.

Income and growth financial chart

Source: Getty Images

Stocks are tumbling, but investors should get ready to buy

Undoubtedly, the S&P 500 hasn’t even corrected, yet it feels like people are fearing some sort of collapse. Of course, the TSX Index has been under the most pressure for around a year, but that’s just how corrections work. They don’t feel good, but they’re not a sign that it’s time to hit the panic button and find something in your long-term Tax-Free Savings Account (TFSA) portfolio to sell. If anything, buying could be the long-term move if you’re not confident in your ability to get back in after you’ve gotten out.

Remember that Mr. Market won’t give you any sort of warning when it’s time to get back into the water. Even for the most seasoned of traders, it’s hard to do and could end up just costing one money in the form of commissions, capital gains taxes, or even having to pay a higher price of admission for the same stock you dumped at a much lower price closer to the market trough.

Cameco: A better way to bet on the AI surge from the energy side

In any case, I think it’s worth checking in with some of the proven market performers and giving them credit for their resilience amid hard times. Cameco (TSX: CCO) stands out as a stellar uranium producer that should probably fuel the core of any long-term-focused growth portfolio.

The stock slipped close to 18% from its peak, but, believe it or not, the name is still beating the market so far this year, gaining close to 10% year to date. Over the past year, the gains have been even more pronounced, with shares more than doubling, rising 127% in the past year.

Of course, the TSX Index had a standout 2025, but Cameco took things to the next level. The AI data centre boom needs more energy, and a lot of the energy is going to come from nuclear reactors. That requires more uranium, and with prices bouncing back, I think that Cameco is one of the very few ways to play uranium’s strength with operating leverage. In my view, uranium producers, like Cameco, are the AI plays to benefit from as the data centre buildout continues in the coming years. Indeed, it’s a pretty simple thesis.

More AI compute (think inference in addition to training) means more data centres, and that requires far more power. With nuclear deals in place with many big data centre titans, it feels like there’s no holding back the nuclear renaissance and premier miners like Canada’s very own Cameco.

Fool contributor Joey Frenette has no position in any of the stocks mentioned. The Motley Fool recommends Cameco. The Motley Fool has a disclosure policy.

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