Constellation Energy, along with other nuclear-related plays, soared at the stock market open before turning mixed Tuesday after the S&P 500 nuclear power giant announced it signed a 20-year deal to provide energy to Facebook-parent Meta to fuel its "AI ambitions."
Nuclear energy stocks broadly rallied in late 2024 after Constellation Energy sealed a two-decade contract with Microsoft in September to provide nuclear power for the tech giant's data centers. It appears the S&P 500 component could be energizing the sector once more after the deal with Meta.
Under the agreement, Meta will purchase nuclear energy from Constellation's Clinton Clean Energy Center in Clinton, Ill. The deal will support the relicensing and continued operations of the Clinton nuclear facility, beginning in June of 2027. The S&P 500 company added that the deal with Meta will expand Clinton's energy output by 30 megawatts. Constellation did not reveal financial details of the arrangement.
"We are excited to partner with Constellation and the Clinton community to ensure the long-term operations of the nuclear plant, add new capacity, and help preserve over 1,000 jobs. Securing clean, reliable energy is necessary to continue advancing our AI ambitions," Urvi Parekh, Head of Global Energy at Meta, said in the press release Tuesday.
Nuclear-related stocks generally moved higher at the opening bell for Tuesday's stock market action. Constellation Energy soared as high as 342 before retreating, closing down around 0.1% to 313.03. Meanwhile, fellow S&P 500 nuclear utilities play Vistra advanced 5% to 176.03.
Talen Energy jumped 2.7% higher Tuesday.
Constellation Energy Stock Rises On S&P 500
Constellation Energy shares shot up 91% during last year's stock market trade while Vistra stock rocketed 258%, placing both among the top S&P 500 stocks and the best 100 stocks of 2024.
CEG rose 2.4% to 313.43 on Monday, about 6% above a 296.17 handle buy point from a very deep base, according to MarketSurge chart analysis.
The S&P 500 stock is up around 40% this year, and within 11% of its all-time high of 352 from Jan. 23.
Constellation Energy stock has a 21-day average true range of 4.06%. The ATR metric is available on IBD's MarketSurge charting tool that gauges the characteristic breadth of a stock's behavior. Stocks that tend to make large jumps or dives in daily action, the kind that can trigger sell rules and shake investors out of a stock, have a high ATR. Stocks that tend to make more incremental moves have lower ATRs.
The S&P 500 and Nasdaq are now in a power trend. Investors can buy stocks with ATRs up to 8%, though they should be wary of being too concentrated in high-octane names.
In early May, Constellation Energy underperformed first-quarter profit expectations but kept its 2025 guidance steady. Vistra reported a surprise first-quarter loss, but similar to Constellation, it also kept its 2025 guidance steady.
Constellation Energy saw Q1 EPS grow nearly 18% to $2.14 with sales increasing 10% to $6.79 billion.
Meanwhile, the Baltimore-based company also stuck to its initial 2025 guidance from Jan. 10 of adjusted earnings between $8.90-$9.60 per share, keeping its expectations steady since announcing the acquisition of Calpine, a privately owned natural gas and geothermal power generator, for $26.6 billion.
S&P 500 Nuke Stock Soars As It Holds Outlook Steady, An AI-Trend Vote Of Confidence
Trump Executive Orders Ease Regulation
The link to the stock market's AI boom meant nuclear energy stocks spent much of 2024 running at the top of the S&P 500. CEG, VST and other new nuclear-focused companies rode the wave of excitement as Big Tech scrambled to find the electricity needed to power its artificial intelligence ambitions.
Nuclear-stocks took off again as President Donald Trump recently signed multiple executive orders to ease regulations for new nuclear reactors and support uranium supply chains.
Trump signed four executive orders May 23 to support the nuclear energy sector and put in place a "total and complete reform" of the Nuclear Regulatory Commission, or NRC, as well as to speed up the deployment of new nuclear power reactors in the U.S.
The executive orders also define AI as a national security objective stipulates that the Departments of Energy and Defense work with the private sector to accelerate deployments of small modular reactors, or SMRs, to power AI.
Stargate Venture To Boost U.S. AI Infrastructure
The executive orders come as Trump announced earlier this year that Sam Altman's OpenAI, along with SoftBank and Oracle, are planning a joint venture called Stargate. The plan is to build data centers and other AI infrastructure in the U.S., with investments of up to $500 billion.
Nuclear-power startup Oklo, uranium miner Centrus Energy and the U.S. Navy's main nuclear reactor supplier BWX Technologies were all upgraded last week.
William Blair analyst Jed Dorsheimer on Wednesday initiated coverage of the three nuclear-related stocks at outperform in the wake of Trump's nuclear energy executive orders.
"We view these actions as the most consequential shift in energy policy of our lifetimes," Dorsheimer wrote Wednesday of the executive orders.
Dorsheimer noted that Centrus Energy, Oklo, BWX Technologies along with GE Vernova are expected to benefit from Trump's four executive orders signed last week. The analyst noted that Oklo Chief Executive Jacob DeWitte joined Trump at the White House for signing of the executive orders.
Constellation Energy stock has a 91 Composite Rating out of a best-possible 99. The S&P 500 stock also has a 95 Relative Strength Rating. The nuclear stock has a 41 EPS Rating.
Please follow Kit Norton on X @KitNorton for more coverage.
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