Personally, I believe that nuclear energy will undoubtedly be the energy source of the future, besides being much less polluting than fossil fuels, I think it has much better uses and power than traditional energy sources. This has led to the rise of undervalued nuclear energy stocks to buy.
There are many companies making great efforts to exploit this energy source and apply it in different ways. It is a sector with a lot of potential in the future and of course, it is worth studying the companies involved in this sector.
Here I bring you three undervalued nuclear stocks that are worth analyzing, let’s start with this.
Dominion Energy (D)
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Dominion Energy (NYSE:D) is a multifaceted energy company involved in several sectors of the energy market. Although it is often associated with nuclear power, its influence extends far beyond that. A key reason why investors consider Dominion to be an undervalued gem lies in its financial results.
In the second quarter of 2023, they posted solid GAAP net income of $0.69 per share, complemented by operating earnings of $0.53 per share. Even more promising, its third-quarter guidance anticipates operating earnings of $0.72 to $0.87 per share. These figures suggest not only stability but significant growth potential.
Recent headlines highlight Dominion’s strategic moves to streamline its operations. The company has signed three definitive agreements to sell its natural gas distribution businesses, including The East Ohio Gas Company, Public Service Company of North Carolina, Incorporated, and Questar Gas Company, to Enbridge (NYSE:ENB). These divestitures allow Dominion to focus on its strengths and allocate resources more efficiently. This helps make it one of those undervalued nuclear energy stocks.
They are also making waves in the renewable energy sector with projects such as Dulles Solar and Storage at Dulles International Airport. This ambitious initiative aims to be the largest renewable energy project ever developed at a U.S. airport.
It is expected to generate a whopping 100 megawatts of solar power while storing up to 50 megawatts of energy. This not only underscores Dominion’s commitment to sustainability but also demonstrates its ability to innovate and seize opportunities in a rapidly changing energy landscape.
Constellation Energy (CEG)
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Constellation Energy (NASDAQ:CEG) has become a leader in the energy sector, recognized for its commitment to clean energy. Not only is it the largest producer of carbon-free energy in the U.S., but it is also the third largest energy producer overall. What sets them apart as a choice for savvy investors looking to diversify their portfolios is a mix of impressive financial results and unwavering dedication to sustainability.
In the second quarter of the year, they posted solid operating income totaling $669 million. Pre-tax profit was equally impressive, reaching US$1.171 million. These figures demonstrate the company’s financial stability and resilience.
However, their impact goes beyond the balance sheet. The company actively supports the U.S. Environmental Protection Agency (EPA) in its mission to reduce carbon emissions from fossil power plants. Unlike some industry giants that resist such efforts, Constellation not only applauds these initiatives but actively contributes ideas to improve environmental guidelines.
In addition, they have signed a groundbreaking 12-year agreement with Cook County, Illinois, to supply emission-free renewable energy to 18 county-owned buildings. This partnership, which will begin in March 2025, even includes renewable energy certificates, ensuring that public facilities such as health clinics and warehouses run on clean energy.
Constellation Energy has partnered with Swift Current Energy to leverage 24 MW of renewable energy from the Double Black Diamond Solar project in Illinois. This venture aligns perfectly with Cook County’s ambitious goals to reduce greenhouse gas emissions and achieve 100% renewable electricity for its own buildings by 2030, following an impressive 44% reduction from the 2010 baseline.
Uranium Energy (UEC)
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Uranium Energy (NYSE:UEC) is embarking on a journey into the world of nuclear energy, specializing in the search for and extraction of uranium, a key element in the production of nuclear energy.
Turning our attention to its financial situation, as of April 2023, the company had approximately $17,463 in cash. However, this figure is lower than what it had in July 2022, indicating a possible decrease in cash on hand. In particular, its inventories have seen a substantial decrease from $66,570 to $26,637. This change could indicate the sale or use of its uranium reserves.
The plot thickens in April 2023, when they announced a major development. They acquired exploration projects in Canada, expanding their territory in the search for uranium. This strategic move gives them stakes in several joint ventures and access to promising land in the uranium-rich Athabasca Basin, a region known for the abundance of this critical element. It is like expanding their “hunt” to new lands teeming with nuclear treasures. All in all, it’s one of those undervalued nuclear energy stocks.
In addition, the company reported progress in Wyoming, where it is actively engaged in in situ remediation projects. This suggests that its uranium mining operations are proceeding apace.
As of this writing, Gabriel Osorio-Mazzilli did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Gabriel Osorio is a former Goldman Sachs and Citigroup employee. He possesses discipline in bottom-up value investing and volatility-based long/short equities trading.
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