Constellation Energy Corporation (CEG): A Bull Case Theory

Group 1: Company Overview - Constellation Energy Corporation (CEG) is the largest producer of carbon-free electricity in the U.S., with a capacity of 32 GW, primarily from nuclear energy [2] - The company provides approximately 20% of all U.S. nuclear generation and has key customers including Microsoft, Amazon, and Google, with a new 20-year deal with Meta starting in 2027 [2] Group 2: Financial Performance - In Q2, CEG's revenue increased by 11.3% to $6.1 billion, and GAAP EPS rose by 3.5% to $2.67 [3] - The company has authorized a $400 million share repurchase program, indicating strong capital allocation discipline [3] Group 3: Growth Prospects - CEG's growth is supported by increasing demand from AI, electrification, and reshoring, along with favorable policies from the Inflation Reduction Act [4] - The forecast for EPS growth is 9.1% in FY25 and 18% in FY26, suggesting a strong growth trajectory despite a higher P/E multiple compared to peers [4] Group 4: Market Position and Valuation - CEG's trailing and forward P/E ratios are 33.67 and 28.74, respectively, indicating a premium valuation justified by its scale and focus on carbon-free energy [1][4] - The stock price has appreciated approximately 47% since previous coverage, driven by rising demand and higher pricing [5]