3 Top Nuclear Power Stocks to Buy in October

The federal government is giving Holtec International a $1.5 billion loan to help the private company restart the Palisades nuclear power plant. It will be the first nuclear plant to restart in the United States, but it follows the start-up of two brand new nuclear plants by The Southern Company earlier in 2024.

Wall Street believes this could be the sign of the renaissance of nuclear power. If so, here are three ways to play that October revival.

1. Constellation Energy is a public play about reopenings

Constellation Energy (CEG 2.94%) is a large competitive power producer, meaning it sells power on the open market instead of being a regulated utility. The biggest point of differentiation is that it owns or has an interest in 14 operating nuclear power facilities (which includes 25 actual nuclear plants), the largest nuclear power pool of any public company. That alone makes it an interesting way to play nuclear power.

However, if you’re looking at the Michigan plant restart and think that’s an interesting story, well, Constellation Energy just announced that it will be reopening a plant at Three Mile Island. Microsoft plans to buy all the power under a 20-year power purchase agreement.

Constellation estimates it could increase its earnings growth rate by as much as three percentage points, taking it from 10% to 13%. That’s huge, and investors quickly pushed the stock higher. But if you want to get in on the reopening trend, Constellation is the only public option you have right now.

2. Cameco sells uranium, the nuclear fuel of choice

Cameo (CCJ 3.76%) is a miner from Canada. Its main product is uranium, which is what is used to create the fuel that powers nuclear power plants. That makes it a vital supplier to the nuclear power industry.

If a nuclear renaissance takes shape, Cameco will likely benefit as demand for uranium increases. In particular, it has sizeable operations in Canada, which is politically and economically stable, making it a more reliable supplier than other major uranium suppliers in the world. This could lead to Cameco being the supplier of choice in the US market.

There is one important caveat with Cameco that applies to almost all miners. Cameco sells a commodity, and so its top and bottom lines will rise and fall with the price of uranium. This has been a major problem for uranium miners in recent years as the price has fallen to painfully low levels following the nuclear crisis in Fukushima, Japan.

The price has since recovered, and a nuclear revival would likely be very supportive of higher prices in the long run. But investors should go in with the clear understanding that Cameco’s business has historically been quite volatile.

3. NuScale Power looks to the nuclear future

One of the biggest problems with nuclear power is that, historically, nuclear power plants have been large and time-consuming (and expensive) to build. Southern Company’s new nuclear units (Vogtle 3 and 4), for example, were years behind schedule and billions over budget.

This is what NuScale Power (SMR 9.49%) hopes to change. Work is underway to approve a small modular nuclear reactor (SMR) project. The next milestone in the effort will occur in mid-2025.

Read this last statement to mean that NuScale does not yet have permission to build its SMRs. But he is making good progress towards this goal; it will simply require more time – and money. This is basically a money-losing nuclear upstart.

Why invest in it? Well, assuming it gets the approvals it needs, building its SMRs will solve some of the biggest problems facing widespread nuclear adoption. SMRs are built in a factory, keeping costs down. Their smaller size increases safety and allows them to be placed in remote locations. And they can be linked together to create a larger power plant.

If NuScale Power ever starts building SMRs, it could be a game-changing technology in the nuclear power sector. This is a high-risk play, of course, but long-term investors might like the prospects here.

Three ways to play if nuclear excites you in October

The big draw around nuclear power is that it doesn’t produce gases that promote global warming. So, although the energy source has a negative image, it is still clean energy. And it’s clean energy that’s always available, unlike intermittent energy sources like solar and wind.

So if you’re following the news as October rolls in and are intrigued by the restart of shuttered nuclear plants, three ways to play the nuclear power restart are power plant restarter Constellation Energy, nuclear fuel supplier Cameco and nuclear power futurist NuScale Power.