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CEG Stock Rises 30.1% YTD: What's the Best Investment Strategy?
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Key Takeaways
CEG has rallied 30.1% YTD, driven by strong nuclear operations and growing clean energy demand.
CEG held long-term uranium contracts and a 94.1% nuclear fleet capacity factor in Q1 2025.
Calpine acquisition approval strengthens CEG's clean energy capability.
Constellation Energy Corporation’s (CEG - Free Report) shares have rallied 30.1% year to date compared with the Zacks Alternate Energy – Other industry’s growth of 17.2%. CEG continues to gain from the addition of clean energy to the grid through the effective operation of its nuclear reactors and the approval of new licenses to prolong the lives of its existing plants.
Another operator from the same industry, GE Vernova Inc. (GEV - Free Report) , has gained 41.4% during the said period. GE Vernova places a significant emphasis on nuclear operations, particularly through its GE Vernova Hitachi Nuclear Energy (“GVH”) joint venture. GVH is a leading provider of advanced reactors, fuel, and nuclear services, working to enhance reactor performance, power and safety. This includes developing and deploying boiling water reactors and small modular reactors (“SMR”) like the BWRX-300.
Image Source: Zacks Investment Research
Is it a good time to add CEG stock to your portfolio now? Let's examine the elements that contributed to the share price gain in detail and assess the stock's investment prospects.
Factors Driving the Performance of CEG Stock
Constellation Energy’s primary power production comes from its nuclear fleet, and it is well-positioned in terms of nuclear fuel. The company has created a diverse and resilient portfolio that can withstand the nuclear fuel supply disruption. It is also engaged in multiple long-term uranium supply contracts running well into the 2030s. These steps will ensure continued production from its nuclear fleet.
Constellation Energy accounts for around 10% of the nation’s total clean energy production. It is also an industry leader in operating nuclear plants safely, efficiently and reliably. CEG’s nuclear fleet capacity factor was an impressive 94.1% in the first quarter compared with 93.3% in the year-ago quarter.
It expects capital expenditures of nearly $3 billion and $3.5 billion for 2025 and 2026, respectively. Nearly 35% of projected capital expenditures are for the acquisition of nuclear fuel, which includes additional nuclear fuel to increase inventory levels. By balancing investments between maintaining its leading nuclear capabilities and expanding into renewables, the company positions itself to thrive in an evolving energy market focused on sustainability.
With its robust nuclear infrastructure, Constellation Energy also aims to meet the increasing demand from power-intensive sectors like data centers. Constellation and Meta recently inked a 20-year nuclear power purchase agreement in Illinois that will begin in 2027. Following the expiration of the state's ratepayer-funded zero-emission credit scheme, the deal supports the relicensing and ongoing operations of Constellation Energy's highly effective Clinton nuclear facility for an additional 20 years.
The Public Utility Commission of Texas granted CEG regulatory approval for its previously announced acquisition of Calpine Corporation on June 5, 2025. The approval represents a step forward in CEG's plans to merge Calpine's premier portfolio of low-emission natural gas and geothermal assets with the country's largest zero-emission nuclear fleet, creating a coast-to-coast energy company that can meet the rising demand for sustainable, round-the-clock power.
CEG Stock’s Earnings Estimates
The Zacks Consensus Estimate for CEG’s 2025 and 2026 earnings per share (EPS) indicates an increase of 0.43% and 3.5%, respectively.
Image Source: Zacks Investment Research
Another company, Duke Energy (DUK - Free Report) , also produces a large volume of clean energy from its nuclear units. Duke Energy is exploring advanced nuclear technologies like SMRs to diversify its energy generation portfolio and expand the role of nuclear power in the future. The bottom-line estimate for 2025 indicates no change year over year, while that for 2026 implies a decrease of 0.15%.
CEG’s Earnings Surprise History
Constellation Energy’s earnings are consistent, visible and easy to calculate. The company has reported an average earnings surprise of 7.41% in the last four reported quarters.
Image Source: Zacks Investment Research
GE Vernova beat on earnings in three of the trailing four quarters and missed in one, delivering an average surprise of 34.7%.
CEG’s Capital Return Program
Constellation Energy continues to make share repurchases. It has repurchased shares to raise shareholders’ value. Since 2023, CEG’s board of directors has authorized the repurchase of up to $3 billion of the company's outstanding common stock. As of March 31, 2025, the company had approximately $841 million remaining authority to repurchase shares of its outstanding common stock.
CEG pays a quarterly dividend to its shareholders. The company aims to increase its dividend by 10% annually, subject to its board's approval. Check CEG’s dividend history here.
CEG’s Return on Equity
Constellation Energy’s trailing 12-month return on equity of 21.93% is better than the industry average of 8.35%. Return on equity, a profitability measure, reflects how effectively a company utilizes its shareholders’ funds to generate income.
Image Source: Zacks Investment Research
CEG Stock Trades at a Premium
Constellation Energy is currently trading at a premium compared with its industry on a forward 12-month P/E basis.
Image Source: Zacks Investment Research
Duke Energy is also trading at a premium compared with its industry’s P/E F12M.
Summing Up
Due to its strong generating capacity, Constellation Energy has the opportunity to take advantage of the increasing demand for clean energy throughout its service areas, a trend that is primarily being driven by the quick growth of AI-powered data centers.
The investors can hold onto this Zacks Rank #3 (Hold) stock and enjoy the benefits of regular dividends, share repurchase programs and rising earnings estimates. Given its premium valuation, new investors can wait and look for a better entry point.
Image: Bigstock
CEG Stock Rises 30.1% YTD: What's the Best Investment Strategy?
Key Takeaways
Constellation Energy Corporation’s (CEG - Free Report) shares have rallied 30.1% year to date compared with the Zacks Alternate Energy – Other industry’s growth of 17.2%. CEG continues to gain from the addition of clean energy to the grid through the effective operation of its nuclear reactors and the approval of new licenses to prolong the lives of its existing plants.
Another operator from the same industry, GE Vernova Inc. (GEV - Free Report) , has gained 41.4% during the said period. GE Vernova places a significant emphasis on nuclear operations, particularly through its GE Vernova Hitachi Nuclear Energy (“GVH”) joint venture. GVH is a leading provider of advanced reactors, fuel, and nuclear services, working to enhance reactor performance, power and safety. This includes developing and deploying boiling water reactors and small modular reactors (“SMR”) like the BWRX-300.
Image Source: Zacks Investment Research
Is it a good time to add CEG stock to your portfolio now? Let's examine the elements that contributed to the share price gain in detail and assess the stock's investment prospects.
Factors Driving the Performance of CEG Stock
Constellation Energy’s primary power production comes from its nuclear fleet, and it is well-positioned in terms of nuclear fuel. The company has created a diverse and resilient portfolio that can withstand the nuclear fuel supply disruption. It is also engaged in multiple long-term uranium supply contracts running well into the 2030s. These steps will ensure continued production from its nuclear fleet.
Constellation Energy accounts for around 10% of the nation’s total clean energy production. It is also an industry leader in operating nuclear plants safely, efficiently and reliably. CEG’s nuclear fleet capacity factor was an impressive 94.1% in the first quarter compared with 93.3% in the year-ago quarter.
It expects capital expenditures of nearly $3 billion and $3.5 billion for 2025 and 2026, respectively. Nearly 35% of projected capital expenditures are for the acquisition of nuclear fuel, which includes additional nuclear fuel to increase inventory levels. By balancing investments between maintaining its leading nuclear capabilities and expanding into renewables, the company positions itself to thrive in an evolving energy market focused on sustainability.
With its robust nuclear infrastructure, Constellation Energy also aims to meet the increasing demand from power-intensive sectors like data centers. Constellation and Meta recently inked a 20-year nuclear power purchase agreement in Illinois that will begin in 2027. Following the expiration of the state's ratepayer-funded zero-emission credit scheme, the deal supports the relicensing and ongoing operations of Constellation Energy's highly effective Clinton nuclear facility for an additional 20 years.
The Public Utility Commission of Texas granted CEG regulatory approval for its previously announced acquisition of Calpine Corporation on June 5, 2025. The approval represents a step forward in CEG's plans to merge Calpine's premier portfolio of low-emission natural gas and geothermal assets with the country's largest zero-emission nuclear fleet, creating a coast-to-coast energy company that can meet the rising demand for sustainable, round-the-clock power.
CEG Stock’s Earnings Estimates
The Zacks Consensus Estimate for CEG’s 2025 and 2026 earnings per share (EPS) indicates an increase of 0.43% and 3.5%, respectively.
Image Source: Zacks Investment Research
Another company, Duke Energy (DUK - Free Report) , also produces a large volume of clean energy from its nuclear units. Duke Energy is exploring advanced nuclear technologies like SMRs to diversify its energy generation portfolio and expand the role of nuclear power in the future. The bottom-line estimate for 2025 indicates no change year over year, while that for 2026 implies a decrease of 0.15%.
CEG’s Earnings Surprise History
Constellation Energy’s earnings are consistent, visible and easy to calculate. The company has reported an average earnings surprise of 7.41% in the last four reported quarters.
Image Source: Zacks Investment Research
GE Vernova beat on earnings in three of the trailing four quarters and missed in one, delivering an average surprise of 34.7%.
CEG’s Capital Return Program
Constellation Energy continues to make share repurchases. It has repurchased shares to raise shareholders’ value. Since 2023, CEG’s board of directors has authorized the repurchase of up to $3 billion of the company's outstanding common stock. As of March 31, 2025, the company had approximately $841 million remaining authority to repurchase shares of its outstanding common stock.
CEG pays a quarterly dividend to its shareholders. The company aims to increase its dividend by 10% annually, subject to its board's approval. Check CEG’s dividend history here.
CEG’s Return on Equity
Constellation Energy’s trailing 12-month return on equity of 21.93% is better than the industry average of 8.35%. Return on equity, a profitability measure, reflects how effectively a company utilizes its shareholders’ funds to generate income.
Image Source: Zacks Investment Research
CEG Stock Trades at a Premium
Constellation Energy is currently trading at a premium compared with its industry on a forward 12-month P/E basis.
Image Source: Zacks Investment Research
Duke Energy is also trading at a premium compared with its industry’s P/E F12M.
Summing Up
Due to its strong generating capacity, Constellation Energy has the opportunity to take advantage of the increasing demand for clean energy throughout its service areas, a trend that is primarily being driven by the quick growth of AI-powered data centers.
The investors can hold onto this Zacks Rank #3 (Hold) stock and enjoy the benefits of regular dividends, share repurchase programs and rising earnings estimates. Given its premium valuation, new investors can wait and look for a better entry point.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.