Special Report

Going Nuclear: The Ultimate AI Energy Stock

There’s one thing that AI is going to need besides data to get up and running, and that’s power. 

According to a report by TechTarget, one AI model consumed over 27,000 kilowatt hours (kWh) of electricity in nine days. For reference, that’s more energy than three average U.S. households use up in a whole year. 

And while renewables are destined to be the future of energy tech, an all-renewables grid that can handle the demands of the world’s current consumption is still decades away. Add the energy needs of AI on top of that, and it raises a legitimate question about whether renewables alone will be able to handle our technological future. 

That’s one of several reasons nuclear energy is returning to prominence as a proposed solution to meet future demand. While there’s already more nuclear energy in the United States than most people know – accounting for around 20% of our energy supply – development of domestic nuclear capability has stalled over the past three decades over environmental, safety and budgetary concerns.  

Well, that time has officially passed. As of July 31, 2023, a new nuclear reactor near Waynesboro, Georgia, became the first in nearly seven years to start operations, providing totally clean energy to an estimated 500,000 homes and businesses. 

And the United States is now investing heavily in the next generation of nuclear reactors. A company called TerraPower, founded by former Microsoft CEO Bill Gates, has been building a demonstration version of its Natrium reactor, an energy storage system meant to integrate nuclear and renewable sources to provide consistent clean power to customers. 

With the expanded use of nuclear energy on the horizon, the U.S. is facing a serious bottleneck –the need for domestically produced nuclear fuel. Uranium enrichment has always been a weak point for the U.S., and we need to start developing that capability to make widespread nuclear adoption a reality. 

 One company is currently leading the charge and could very well be the key to unlocking the door to America’s energy self-sufficiency and an AI-powered future. And in the next six to 12 months, I’m anticipating a triple-digit gain for this stock, which could potentially be just the beginning of this company’s future growth. 

That company is Centrus Energy (LEU), a Maryland-based firm that is one of the world’s 

most diversified suppliers of enriched uranium nuclear fuel. It operates in all theaters: procurement, enrichment and shipping. One of its unique advantages in the market is that it’s one of the most politically connected companies in the entire sector. The new CEO, Amir Vexler, spent 20 years at general electricGeneral Electric Company and served as President and CEO of Orano USAE and oversaw its sales of nuclear fuel, decommissioning services, nuclear fuel management, medical isotopes, and engineering and technology services for the federal government. 

Insider connections such as this have put Centrus at the heart of the government’s efforts to restore America’s domestic uranium enrichment capacity… not just for domestic energy use but for national security as well, given that a majority of the U.S. Navy’s fleets are nuclear-powered. 

In June 2023, it announced one of the first major milestones along that road, having completed operational readiness reviews with the U.S. Nuclear Regulatory Commission to begin the production of High-Assay Low-Enriched Uranium (HALEU) fuel at its facility in Piketon, Ohio.  

In addition, last year it also signed a deal to collaborate with TerraPower on its Natrium reactor,ensuring that it will have the HALEU fuel it needs to bring the next generation of nuclear power to market. 

Consequently, its earnings growth has skyrocketed, with a year-over-year jump of 59.8%  in earnings per share for 2023 off the back of a 9% year-over-year increase in revenue to $320.2 million.  

 It’s currently trading at just over $40 at the time of writing, but this kind of growth is going to catch up with the stock price sooner or later. Now is the time to get in, given the potential for Centrus to become one of the most important energy companies in the near future in America’s quest to meet tomorrow’s AI-driven power demand. 

Action to Take: Buy Centrus Energy (NYSE: LEU) at market.