By Avi Salzman

The nuclear energy boom isn't just a U.S. phenomenon -- it's set to benefit American companies that export their technology overseas.

There's a limit to how fast the nuclear industry in the U.S. can grow. The Trump administration has pledged to quadruple the nation's fleet of reactors by 2050, but that's a tall order. There are no new reactors under construction in the U.S., and it probably will take a decade for any to be completed once work does begin.

U.S. nuclear companies, however, are making real money today on exports.

The latest sign came earlier this month when uranium miner and nuclear tech company Cameco announced that it would see a big boost to its adjusted earnings because of plans for two new nuclear reactors in the Czech Republic.

Other winners from the nuclear export trend include Brookfield Asset Management, GE Vernova, and BWX Technologies. Nuscale, a start-up reactor developer, may also benefit from a deal in Romania.

Cameco owns 49% of nuclear reactor developer Westinghouse, a Pennsylvania company that has designed one of the most popular advanced reactors in the world, known as the AP1000. The other 51% of Westinghouse is owned by Brookfield.

Two AP1000s have been built in Waynesboro, Ga., but the company is having more luck lately making money overseas. In the Czech Republic, a Korean company is building two reactors that are based on the underlying AP1000 technology, and paying Westinghouse to use it.

Cameco said the Czech reactors would add $170 million to the company's adjusted earnings before interest, taxes, depreciation, and amortization, or Ebitda, from its Westinghouse stake in the second quarter.

That is a big benefit to a business that brought in $92 million in adjusted Ebitda in the first quarter. Over the longer term, Cameco expects to receive "significant financial benefits" from the Czech reactors as a subcontractor and by offering fuel services.

The potential benefits go well beyond the Czech Republic.

Nuclear energy is gaining popularity around the world, as countries look to decarbonize their electricity systems and reduce their reliance on volatile commodities like oil and natural gas. Even countries like Germany and Japan that had previously sworn off nuclear power are now embracing it.

China and Russia have dominated the nuclear export market in recent years, but that is starting to change. European countries are no longer comfortable having Russia build their reactors, and some countries also seem reluctant to make deals with China.

Nuclear reactors are useful for 40 years or more, so signing a construction deal is the beginning of a long-term relationship. In an unstable world, old business relationships are falling apart.

"The world for gigawatt-scale reactors has actually changed dramatically since the Russian invasion of Ukraine," said Grant Isaac, Cameco's chief financial officer.

Isaac says that countries that once relied on Russian technology are turning to new suppliers, including Westinghouse. Bulgaria and Poland are both planning to build multiple AP1000s. Japan and China have already built them.

The market was "slow to adjust to the embedded optionality within Cameco's Westinghouse stake," wrote GLJ Research analyst Gordon Johnson.

But investors have recently caught on. Shares are up 36% in the past month and trade at 43 times next year's expected earnings.

BWX Technologies is another way to play the nuclear theme. The Virginia-based supplier and servicer for several kinds of reactors and nuclear systems for the Navy has profited from the growth in nuclear energy demand in other countries. Analysts see earnings per share rising 38% by 2027. The stock trades at 33 times its expected 2026 earnings -- a lofty valuation, but a discount to Cameco.

William Blair analyst Jed Dorsheimer thinks BWX's steady government contracts and potential major supply agreements, including with Westinghouse, justify the premium.

"We encourage clients to start or add exposure to BWXT," he wrote after meeting with the company this week.

Other countries may be beating the U.S. to a nuclear future. Thankfully, American companies will be winners too.

Write to Avi Salzman at avi.salzman@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

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June 20, 2025 01:30 ET (05:30 GMT)

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