Constellation Energy’s Stock Surge
The Move: Constellation Energy’s stock rose 12% on Tuesday, closing at $300.40, and has recovered a portion of its 2023 losses, now down approximately 15% year to date.
Why: The increase is attributed to a new contract with Google, where the tech giant will purchase 3,590 megawatts of nuclear power over 20 years. This agreement is expected to facilitate a $4.3 billion investment and generate 7,200 construction jobs for new nuclear facilities to meet rising demand.
Tech companies, including Google, have been increasingly investing in nuclear energy as a power source for AI data centers, amid concerns about power-grid limitations affecting infrastructure for the tech sector.
Previous Contracts: In 2024, Constellation secured a deal with Microsoft to sell energy from the Three Mile Island facility, and signed an agreement with Meta to provide nuclear energy.
Market Impact: While there has been a decline in nuclear energy stocks this year, Google’s recent deal has reinvigorated interest, evidenced by the 5.5% spike in the VanEck Uranium and Nuclear ETF on Tuesday, alongside gains from companies like Oklo and NuScale Power.
Future Outlook: As energy constraints grow, nuclear firms may play a larger role in supporting the booming AI sector and its capital expenditures.
