Nuclear-related stocks, which have roared higher over the past twelve months amid AI-data center growth expectations, angled lower this week as the broader AI-dominated stock market paused to consolidate. Palantir Technologies (PLTR) and others declined in recent days.
S&P 500 nuclear giants Constellation Energy (CEG) and Vistra (VST) enter Friday's stock market down 3% and 3.6%, respectively, for the week. For August, Constellation is down more than 10%, Vistra more than 8%. Meanwhile, companies focused on the burgeoning small modular reactor nuclear technology (SMR), which has seen significant investment form Big Tech, booked larger losses.
Nuclear power startup Oklo (OKLO), which has been backed by OpenAI CEO Sam Altman, headed into Friday's action down 5.45% on the week and holding a 12% loss for the month. Fellow SMR-focused plays NuScale Power (SMR) was down 5.6% for the week and 33% so far in August. Nano Nuclear Energy (NNE) moved nearly 19% lower prior to the opening bell for Friday's stock market. IT is off 17% since the beginning of the month.
Oklo stock is attempting to hold its 50-day moving average with S&P 500 component Vistra working to reclaim that key level after dipping below the 50-day line on Thursday.
The stock market could shift gears quickly on Friday, depending on the content and tone of Fed chief Jerome Powell's Jackson Hole speech at 10 a.m. ET. Powell could signal the central bank is ready to cut rates in September. The odds of a Sept. 17 cut dropped to 71.5% from a virtual lock a week earlier, but remain very high.
Investors can keep tabs on the IBD Leaderboard watchlist, the IBD 50 list of top growth stocks and IBD SwingTrader along with the IBD Sector Leaders list.
As investors this week appeared to hedge bets on whether there is an AI bubble, several analysts initiated and changed coverage on nuclear stocks.
On Monday, Ladenburg double downgraded Nano Nuclear Energy to sell, from a previous buy, with a price target of 9, down from 51. This decision came after NNE reported its fiscal Q3 results. Ladenburg analysts hoped management would streamline its strategy and prioritize core initiatives, but the firm's takeaway was that the company instead continues promoting a broad, diversified model.
Ladenburg analysts added that the company's credibility has been "eroded by missed timelines and broad strategic ambitions."
Meanwhile, UBS on Wednesday initiated coverage of Oklo with a neutral rating and 65 price target. That is slightly below Oklo's 67.19 stock price a of Thursday's close.
UBS analysts wrote they were "cautiously optimistic" on the potential for a broader U.S. nuclear infrastructure build-out but awaits further commercialization progress. The analysts stressed there are risks in nuclear project development while the stock's valuation is elevated relative to the broader nuclear space.
Also on Wednesday, Melius Research initiated coverage of S&P 500 stocks Constellation Energy and Vistra, giving both buy designations. The analysts handed CEG a 462 price target, representing around 48% upside from current levels, while Vistra has a 295 price target. That VST price target is 55% above the current 190.28 Vistra stock price.
Melius Research analysts wrote that the introduction, adoption and acceleration of AI has transformed "energy & power" into an AI category and the market is in the early stages of a "power revolution" that is only in the early innings of shifting leadership toward a whole new group of winners.
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On Thursday, Bank of America initiated coverage of NuScale Power with a neutral rating and a 36 price target, representing about 7% upside. The firm wrote that NuScale offers "a more de-risked fuel pathway" compared to SMR-focused peers, but that the company remains in the early commercialization stage and that the current valuation "already prices in significant future success."
BWX Technologies (BWXT), the U.S. Navy's main nuclear reactor supplier, traded down 4.7% in early stock market action Friday. The stock has declined around 13% since hitting an all-time high of 189.25 on Aug. 5 after reporting much better-than-expected second-quarter earnings and revenue.
Uranium miner Centrus Energy (LEU) was down 3.3% for the week early Friday. Similar to BWXT, Centrus has declined 33% since roaring to record highs following earnings on Aug. 5.
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Canada-based uranium refiner Cameco (CCJ) dropped 5.5% this week, heading toward Friday's market open. Cameco, which owns a 49% stake in nuclear reactor builder Westinghouse, also recently announced better-than-expected second-quarter earnings, with quarterly profit soaring 410%.
Among other nuclear plays, GE Vernova (GEV) was down 2.6% on the week. Uranium Energy (UEC) moved 10.3% lower through Thursday while Lightbridge (LTBR) dropped 12%. Energy Fuels (UUUU) edged down 4% as of Thursday's market close.
Please follow Kit Norton on X @KitNorton for more coverage.
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