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Can CEG's Use of Small Modular Reactors Redefine Nuclear Efficiency?
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Key Takeaways
Constellation Energy is pursuing SMRs to serve growing demand from AI and data centers.
The company plans to leverage existing nuclear sites for faster SMR deployment.
CEG shares have surged 62.5% in a year, outpacing the industry's 57.1% growth.
Constellation Energy Corporation (CEG - Free Report) is focusing on the development and potential deployment of Small Modular Reactors (“SMRs”) to address the growing energy requirements of customers, including data centers and artificial intelligence operators. The company sees SMRs as a scalable, carbon-neutral power solution that can leverage existing nuclear sites and infrastructure for faster deployment. This will improve CEG’s overall performance and help it create new revenue sources.
Compared to conventional big reactors, SMRs' modular design enables factory prefabrication and quicker on-site assembly, greatly cutting down on construction delays. Additionally, by reducing upfront expenses, this modular strategy makes projects less risky and more attractive for financing. This aligns with CEG’s goal of providing a reliable, 24/7 clean energy solution.
CEG intends to use existing land, water access, grid connections, and security infrastructure to host SMRs at its current nuclear plant locations, thereby increasing deployment efficiency.
Constellation Energy and Rolls-Royce Holdings plc signed a Memorandum of Understanding in 2020 to pursue the potential for CEG to operate compact nuclear power stations both in the United Kingdom and internationally. CEG will be using its operational experience to assist Rolls-Royce in the development and deployment of the SMRs.
CEG is also evaluating strategies to extend the plant’s existing early site permit or seek a new construction permit from the Nuclear Regulatory Commission (“NRC”) to pursue development of an advanced nuclear reactor or SMR at the Clinton Clean Energy Center site.
Companies Benefiting From Small Modular Reactors
SMRs have faster build times than traditional large reactors, allowing for quicker integration into the grid and creating new revenue streams. Other companies taking advantage of SMRs are:
NuScale Power Corporation (SMR - Free Report) : Leveraging proven technology and extensive investment, the NuScale Power Module is the only NRC-approved small modular reactor technology on the market that is commercially ready to deploy.
GE Vernova (GEV - Free Report) is a key player in the development and deployment of SMRs, particularly through its BWRX-300 design. This strategic position allows it to secure early projects and establish itself as a leader in advanced nuclear technology.
CEG Stock’s Earnings Estimates
The Zacks Consensus Estimate for 2025 and 2026 EPS indicates an increase of 8.54% and 25.99%, respectively, year over year.
Image Source: Zacks Investment Research
CEG Stock Trading at a Premium
CEG is trading at a premium relative to the industry, with a forward 12-month price-to-earnings of 28.67X compared with the industry average of 20.83X.
Image Source: Zacks Investment Research
CEG Stock’s Price Performance
In the past year, CEG’s shares have risen 62.5% compared with the industry’s 57.1% growth.
Image: Bigstock
Can CEG's Use of Small Modular Reactors Redefine Nuclear Efficiency?
Key Takeaways
Constellation Energy Corporation (CEG - Free Report) is focusing on the development and potential deployment of Small Modular Reactors (“SMRs”) to address the growing energy requirements of customers, including data centers and artificial intelligence operators. The company sees SMRs as a scalable, carbon-neutral power solution that can leverage existing nuclear sites and infrastructure for faster deployment. This will improve CEG’s overall performance and help it create new revenue sources.
Compared to conventional big reactors, SMRs' modular design enables factory prefabrication and quicker on-site assembly, greatly cutting down on construction delays. Additionally, by reducing upfront expenses, this modular strategy makes projects less risky and more attractive for financing. This aligns with CEG’s goal of providing a reliable, 24/7 clean energy solution.
CEG intends to use existing land, water access, grid connections, and security infrastructure to host SMRs at its current nuclear plant locations, thereby increasing deployment efficiency.
Constellation Energy and Rolls-Royce Holdings plc signed a Memorandum of Understanding in 2020 to pursue the potential for CEG to operate compact nuclear power stations both in the United Kingdom and internationally. CEG will be using its operational experience to assist Rolls-Royce in the development and deployment of the SMRs.
CEG is also evaluating strategies to extend the plant’s existing early site permit or seek a new construction permit from the Nuclear Regulatory Commission (“NRC”) to pursue development of an advanced nuclear reactor or SMR at the Clinton Clean Energy Center site.
Companies Benefiting From Small Modular Reactors
SMRs have faster build times than traditional large reactors, allowing for quicker integration into the grid and creating new revenue streams. Other companies taking advantage of SMRs are:
NuScale Power Corporation (SMR - Free Report) : Leveraging proven technology and extensive investment, the NuScale Power Module is the only NRC-approved small modular reactor technology on the market that is commercially ready to deploy.
GE Vernova (GEV - Free Report) is a key player in the development and deployment of SMRs, particularly through its BWRX-300 design. This strategic position allows it to secure early projects and establish itself as a leader in advanced nuclear technology.
CEG Stock’s Earnings Estimates
The Zacks Consensus Estimate for 2025 and 2026 EPS indicates an increase of 8.54% and 25.99%, respectively, year over year.
Image Source: Zacks Investment Research
CEG Stock Trading at a Premium
CEG is trading at a premium relative to the industry, with a forward 12-month price-to-earnings of 28.67X compared with the industry average of 20.83X.
Image Source: Zacks Investment Research
CEG Stock’s Price Performance
In the past year, CEG’s shares have risen 62.5% compared with the industry’s 57.1% growth.
Image Source: Zacks Investment Research
CEG’s Zacks Rank
CEG currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.