Investors looking to benefit from the nuclear energy revival are turning their attention to small modular reactor (SMR) companies like Oklo and NuScale. However, these companies rely on fuel to operate their reactors, making Centrus Energy a crucial player as it provides the enriched uranium fuel needed. Centrus has recently announced a joint venture with Oklo to meet the growing need for specialized nuclear fuel.
Fueling the Nuclear Renaissance
Centrus Energy specializes in supplying nuclear fuel and services, notably High-Assay, Low-Enriched Uranium (HALEU), essential for many U.S. reactors, particularly smaller designs like SMRs. Their Piketon, Ohio facility is the first in the U.S. licensed to produce HALEU. Agreements with various SMR developers, including Oklo’s collaboration to supply fuel for its forthcoming power plant in Ohio, highlight Centrus’s pivotal role in the nuclear landscape.
Robust Demand Driving Growth
While Oklo and NuScale currently do not generate commercial power or revenue, Centrus is achieving solid financial results. In its latest quarter, Centrus reported $176.1 million in revenue—a 14% increase year-over-year—and a net income of $16.8 million. With a future revenue backlog of $4.5 billion, including substantial HALEU contracts and a recent $900 million deal with the U.S. Department of Energy, Centrus is well-poised for expansion.
Investment Perspective
Rather than investing in individual SMR startups, which carries uncertainty, owning shares in Centrus Energy offers investors a lower-risk opportunity to engage with the nuclear energy sector. With growing contracts and a critical supply role, Centrus stands to benefit regardless of which SMR developer excels.
For those looking to tap into the nuclear energy renaissance, Centrus Energy represents a stable and potentially lucrative investment option.
