Why Constellation Energy Stock Just Popped

Core Insights - Constellation Energy is set to reopen Three Mile Island Unit 1 to supply electricity to Microsoft data centers, marking a significant step in the nuclear renaissance linked to the growing energy demands of artificial intelligence [1][3] - The company's stock price increased by 5.6% following the announcement of a $1 billion loan from the U.S. Department of Energy to support the reopening of the plant [1][3] Financial Support - The U.S. Department of Energy will provide a $1 billion loan under its Energy Dominance Financing Program, which will cover nearly all of the estimated $1.6 billion cost to restart the plant [3][6] - The loan features a favorable variable interest rate of approximately 5% based on current 30-year Treasury bond rates, with repayment not required until November 17, 2055 [3][4] Market Reaction - Following the announcement of the loan, Constellation Energy's stock experienced a notable increase, reflecting positive market sentiment regarding the company's financial backing and future operations [1][5] - Despite the positive news, there are mixed opinions on whether Constellation Energy stock is a buy at its current valuation, which is nearly 39 times trailing earnings [5][7]