Top Nuclear Energy Stocks to Watch as Sector Approaches Critical Mass
The nuclear energy sector is heating up, largely fueled by big tech’s rapidly rising energy needs to support its growing reliance on AI and cloud computing. Here are the top nuclear stocks investors should be watching.
As the world shifts toward clean, reliable energy sources, nuclear power is emerging as a pivotal player in addressing the surging power demands of the digital age. The nuclear sector has been heating up, driven largely by the tech industry’s growing reliance on artificial intelligence (AI) and cloud computing, which require vast amounts of energy. This has made nuclear energy stocks a prime target for investors looking to capitalize on what many experts are calling a “nuclear renaissance.”
Tech giants like Amazon (NASDAQ: AMZN), Alphabet (NASDAQ: GOOGL), and Microsoft (NASDAQ: MSFT) have recently announced massive investments in small modular reactors (SMRs), a new generation of nuclear technology that promises scalable, carbon-free energy. These moves signal a shift in the tech sector’s approach to sustainability, and the market is taking notice.
Rising Demand for Nuclear Power
The demand for nuclear energy has been steadily increasing due to the exponential growth in data centers required to support AI and cloud computing. Data centers consume vast amounts of electricity, and traditional power sources are struggling to keep up. Nuclear power, with its ability to provide consistent, carbon-free energy, is seen as the ideal solution.
Morgan Stanley (NYSE: MS) analysts have projected that the nuclear sector could attract up to $1.5 trillion in investments by 2050.
David Arcaro, an analyst at the firm, recently commented:
“Nuclear energy is the only carbon-free power source that can consistently meet the growing electricity needs of our digital economy. The tech sector’s embrace of SMRs is a game changer.”
This rising demand is reflected in the stock market, where nuclear energy stocks have been surging in value. Companies like Oklo (NYSE: OKLO), NuScale Power (NYSE: SMR), and Nano Nuclear Energy (NASDAQ: NNE) have seen their stock prices soar in recent months. Oklo, in particular, has seen a meteoric rise of 174% this month alone, backed by investments from major figures like OpenAI CEO Sam Altman and venture capitalist Peter Thiel.
View Oklo Interactive Stock Chart on Barchart
Small Modular Reactors (SMRs): The Future of Clean Energy
SMRs represent a significant advancement in nuclear technology. Unlike traditional nuclear reactors, which are massive and costly to build, SMRs are smaller, modular units that can be assembled in factories and transported to the site. This innovation reduces both construction time and costs, making nuclear power more accessible and scalable.
Oklo, one of the leading developers in the SMR space, is making waves with its fast reactor technology. These reactors don’t require water, recycle spent fuel, and are self-stabilizing, making them safer and more efficient than traditional ones. Oklo’s reactors are set to come online by 2027, and the company has already partnered with major corporations like Apple (NASDAQ: AAPL), Tesla (NASDAQ: TSLA), and SpaceX.
Another major player in the SMR space is NuScale Power, which received federal approval in 2023 for its NuScale Power Module and VOYGR scaling platform. NuScale’s reactors are designed to be flexible, allowing for easy scalability to meet the needs of data centers, industrial projects, and public utilities. The company is currently working on two SMR projects in collaboration with Standard Power, expected to be operational by the end of the decade.
Power Producers and Uranium Suppliers Benefiting from the Surge
It’s not just SMR developers that are benefiting from the nuclear boom. Power producers like Constellation Energy (NASDAQ: CEG) and Vistra (NYSE: VST) are also seeing a surge in stock prices as they sign long-term contracts with tech companies to provide nuclear-generated electricity for AI data centers.
Constellation Energy, which recently struck a deal with Microsoft to restart the Three Mile Island nuclear facility, has seen its stock rise by 30% since the announcement. Meanwhile, Vistra, the best performer in the S&P 500 in 2024, continues to benefit from its diversified energy portfolio, which includes nuclear, solar, coal, and natural gas assets.
Uranium suppliers, essential to powering nuclear reactors, are also experiencing a windfall. Cameco (NYSE: CCJ) (TSX: CCO), one of the world’s largest uranium producers, has seen its stock rise by nearly 45% in the past month alone. The company is well-positioned to capitalize on the growing demand for nuclear fuel, with several projects underway, including the Millennium and Yeelirrie mines.
View Cameco Interactive Stock Chart on Barchart
A Bright Future for Nuclear Energy
While short-term volatility may affect some nuclear energy stocks, the long-term outlook for the sector is undeniably strong. As tech companies continue to invest in nuclear power to meet their growing energy needs, and as governments around the world push for carbon-free energy solutions, nuclear power is poised to play a crucial role in the future of the global energy landscape.
For investors looking to get in on the action, there are several promising options. SMR developers like Oklo and NuScale Power offer exciting, albeit speculative, opportunities. More stable investments can be found in uranium suppliers like Cameco or established power producers like Constellation Energy and Vistra Corp.
In the words of Jacob DeWitte, CEO of Oklo:
“The power demand numbers are mind-blowing. It’s a huge opportunity for a lot of players in the space, and nuclear offers a really great solution.”
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Disclaimer: Wealthy VC does not hold a position in any of the stocks, ETFs or cryptocurrencies mentioned in this article.
