CEG Stock Earnings Preview: Can Constellation Lead the Nuclear Renaissance?

Having spun off from Exelon [EXC] in 2022, Baltimore-headquartered Constellation Energy [CEG] operates an energy generation fleet consisting mainly of nuclear but also hydro, wind and solar power. The largest clean energy and the largest nuclear energy producer in the US, the company delivers 10% of the country’s total clean power, with over 32.4GW of capacity.

Given its impressive energy portfolio — and leading role in the domestic nuclear sector — investors have focused on Constellation’s opportunity to meet growing energy demand from data centers, the infrastructural backbone of the ongoing artificial intelligence (AI) boom. With a recent executive order from US President Donald Trump seeking to “usher in a nuclear renaissance”, many will be looking to Constellation’s upcoming earnings report for signs it is benefitting from these tailwinds.

Key Developments: Constellation Clinches Calpine

As hyperscalers look to fuel their increasingly power-hungry data centers, Constellation has secured a number of promising contracts with big names in tech.

In September 2024, the firm signed a record-breaking 20-year power purchasing agreement with Microsoft [MSFT], which saw it move to restart operations at Pennsylvania’s Three Mile Island plant (shown in the photo above).

While Microsoft later cancelled data center leases totaling a few hundred megawatts, spooking investors, the agreement with Constellation remains in place, with the plant expected to come online in 2027, a year earlier than originally projected.

The latest agreement, signed with Meta [META] in June, includes a 20-year power purchase agreement, beginning in 2027. Constellation’s Clinton Clean Energy Center, located in Illinois, is expected to contribute over 1.1GW to power Meta’s growing AI ambitions.

At the end of July, the company received another boost when the US Federal Energy Regulatory Commission approved its $16.4bn acquisition of fellow energy firm Calpine. The deal, which remains subject to approval from the Department of Justice, is expected to close by the end of 2025.  

Constellation is due to report earnings for Q2 2025 on August 7 before markets open.

CEG Share Price: A Wild Ride

Constellation Energy’s share price movements have followed those of many tech and AI-adjacent stocks in recent months.

The stock saw a significant uptick in early September 2024 on the back of its power purchase agreement with Microsoft. CEG stock continued to rise through to early 2025 on the back of bullish sentiment and wider market optimism, peaking at $352.00 on January 23.

Prices then dipped as low as $161.53 in early April following US President Trump’s tariff announcements, but have since recovered, marking a new all-time high of $357.00 on August 4.

As of the August 4 close, CEG stock was up 59.15% in the year to date, and 113.83% in the past 12 months.

CEG vs OKLO vs PEG: Nuclear Powers

In its Q1 2025 earnings, reported in May, Constellation recorded revenue of $6.79bn, up 10.18% year-over-year and in line with Wall Street expectations. It also logged $673m in adjusted operating earnings, up 16.23% from the year-ago quarter and resulting in an EPS of $2.14. The company reaffirmed its FY 2025 operating earnings guidance of $8.90–9.60 per share.

Thanks to favorable US regulations and growing demand for clean power from tech firms, nuclear certainly has investors’ attention. That said, Constellation is not the only firm to watch in the space.

Santa Clara-based VC darling Oklo [OKLO] has also gotten a lot of press coverage for its potential to power data centers with its in-house small modular reactors. It signed a landmark deal with data center firm Switch in December 2024, and more recently with the US Air Force and Liberty Energy [LBRT]. However, the company has yet to generate revenue, with its first commercial power plant not expected to come online before late 2027.  

Public Service Enterprise Group [PEG], as the second-largest generator of nuclear power in the US, presents a more conventional counterpoint to Constellation. In its Q2 2025 earnings call on August 5, the company reported $2.8bn in revenue, up from $2.4bn in Q2 2024 and above analyst expectations. It also recorded a $0.06 earnings beat and projected EPS guidance of $3.94–4.06 for FY 2025.

Source: Yahoo Finance

CEG Stock: The Investment Case

The Bull Case for CEG

With the US government aiming to triple nuclear energy output by 2050 and data center power demand expected to rise significantly by the end of the decade, nuclear firms such as Constellation are likely to benefit from large, long-term deals. The contracts with Microsoft and Meta, for example, will provide a consistent revenue stream to the company over the next two decades. Additionally, should the Calpine deal clear all regulatory hurdles, the company appears to be moving forward with a larger portfolio than ever.

As of August, two of the 15 analysts surveyed by Yahoo Finance rated CEG stock a ‘strong buy’, whereas eight rated it a ‘buy’. Following the Meta deal, UBS lifted its price target from $320 to $360, representing an upside of 1.44% from the most recent close price. The firm’s analysts highlighted the $30/MWhr premium included in the agreement, which could add $19 per share in value to the company.

The Bear Case for CEG

Given its operations in the nuclear space — an area with outsized reliance on government support and subject to often stringent regulation — Constellation Energy’s prospects could suffer markedly from political headwinds. If the next US administration rolls back Trump-era nuclear expansion plans, Constellation’s power plants could be shuttered again.

Additionally, with its ability to grow tied to deals with large hyperscalers, a popping of the AI bubble could also impact Constellation, leaving it with diminished demand for its generated power. Of the 15 analysts surveyed by Yahoo Finance in August, five rated the stock a ‘hold’. The average price target, meanwhile, was $330.24, some 6.55% down from the most recent close price, suggesting CEG stock may already have surpassed its fair valuation and could be due for a downturn.

Conclusion

As the largest supplier of nuclear power in the US, Constellation Energy could emerge as one of the key players in the country’s “nuclear renaissance”, especially as large power purchasing agreements with big tech names are set to provide the company with long-term revenue streams. That said, an overreliance on AI-related data center growth and an exposure to potential political headwinds could mean the stock is due for a downward revaluation.