Cameco Corporation (USA) (CCJ), Toyota Motor Corporation (ADR) (TM): How Japan’s Nuclear Exports Are Bullish For Certain Industries

As an investment Toyota Motor Corporation (NYSE:TM) is a mixed bag. Its total debt to equity ratio of 1.15 is slightly higher than Honda’s. Even though its return on investments of 4.7% and profit margin of 3.8% are higher than Honda’s, Toyota Motor Corporation (NYSE:TM) is it not perfect. It has dealt with a number of damaging recalls. Other investors have called attention to the lack of independent oversight at the board level.

Exporting of Japan’s nuclear technology and increasing oil imports will support the entire nation. Japanese ETFs like iShares MSCI Japan Index are another possible way to play the trend.

0.81% of iShares MSCI Japan’s holdings are in Mitsubishi Heavy Industries. The company’s nuclear division designs nuclear power plants and could be one of the companies to export nuclear technology directly to Saudi Arabia.

Overall the ETF is a good way to buy a piece of long term Japanese growth. Japan continues  to devalue the Yen and this is good for individual exporters like Honda and Toyota Motor Corporation (NYSE:TM). These companies are held by the fund.  With a net expense ratio of 0.51% and an average price to earnings ratio of 21.5 the fund is not outrageously expensive, though it is more expensive than many U.S. large caps.

Conclusion

Japan’s plan to export nuclear technology to Saudi Arabia in order to ensure more crude oil is a win-win situation. Saudi Arabia will make more money by exporting more of its crude oil and Japan will have a securer supply of crude oil. Uranium miners like Cameco will also benefit from the increased demand for uranium.

Cameco is the best investment with its low debt load, profitable mines and history of overseas sales to Japan. Toyota Motor Corporation (NYSE:TM) and the iShares MSCI Japan ETF have a number of ancillary aspects like the potential for the Bank of Japan to cause a currency war that decrease their attractiveness.

The article Japan’s Nuclear Exports Are Bullish for Miners and Japan originally appeared on Fool.com and is written by Joshua Bondy.

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