Cameco and NuScale Power could deliver multibagger gains over the next decade.Nuclear energy might not seem like a thrilling market for growth-oriented investors. It's dominated by slow-growth energy giants like Duke Energy and NextEra Energy, and the global nuclear power market might only expand at a compound annual growth rate (CAGR) of 2.9% from 2024 to 2029, according to Markets and Markets.However, geopolitical conflicts in fossil fuel regions, green energy initiatives, and the expansion of power-hungr ...

Financial Performance - KBR reported revenues of $2.1 billion for Q1 2025, representing a 13% increase year-over-year, driven by growth across both segments and the LinkWest acquisition [29][30] - Adjusted EBITDA was $243 million, up 17% from the previous year, with an adjusted EBITDA margin of 11.8%, an increase of 40 basis points [29][30] - Adjusted EPS for the quarter was $0.98, reflecting a 27% increase, primarily due to a lower share count from repurchases [29][30] Business Segment Performance - Mission Technology Solutions (MTS) revenues were $1.5 billion, up 14% year-over-year, with adjusted EBITDA of $145 million, an 11% increase [31] - Sustainable Technology Solutions (STS) revenues reached $550 million, a 12% increase, with adjusted EBITDA of $124 million, up 20% [32] - MTS ended the quarter with a 1.0 times book-to-bill ratio, while STS had a book-to-bill ratio of 1.1 times [31][32] Market Dynamics - KBR is experiencing a shift in focus from energy transition projects to energy security initiatives in certain geographies, particularly due to affordability issues [46] - The company maintains a strong position in the military space market, highlighted by a recent $176 million contract win [21] - KBR's international operations are well-positioned to capture geographical shifts in energy markets, particularly in the global South [20][23] Company Strategy and Industry Competition - KBR is focused on executing its growth strategy, increasing bid volumes, and winning new contracts, while maintaining a balanced and resilient business portfolio [41][42] - The company is committed to disciplined capital allocation, returning record levels of capital to shareholders through buybacks and dividends [9][34] - KBR is actively pursuing bolt-on acquisitions that align with its strategic priorities, particularly in government and sustainable technology sectors [75][76] Management Commentary on Operating Environment and Future Outlook - Management expressed confidence in the financial outlook for 2025, reaffirming guidance for revenues between $8.7 billion and $9.1 billion and adjusted EBITDA of $950 million to $990 million [38][39] - The company is monitoring geopolitical situations, particularly troop support in Eastern Europe, but has not observed significant impacts on operations [39][92] - KBR's diversified global mix of business positions it well to navigate economic uncertainties and capitalize on strong secular growth trends [25][26] Other Important Information - KBR achieved a record low total recordable incident rate of 0.05 in 2024, significantly lower than the national average [6][7] - The company ended the quarter with over $20 billion in backlog and options, indicating strong future revenue potential [20][104] Q&A Session Summary Question: Can you provide more color on the backlog growth and energy transition delays? - Management noted a global thematic shift towards energy security over energy transition due to affordability issues, but remains confident in the STS portfolio [46][47] Question: How confident are you in mid-single-digit organic growth for MTS? - Management highlighted a strong alignment with defense budget priorities and increased funding for human space exploration, indicating confidence in growth drivers [49][50] Question: What is the status of the $2 billion in awards under protest? - Management acknowledged a trend of protests in government awards but expects resolutions in the second half of the year [53][55] Question: How is HomeSafe performing during the peak moving season? - Management reported increased customer satisfaction rates and a strong relationship with Transcom, indicating positive performance expectations [56][58] Question: Can you provide insights on LNG project timelines? - Management indicated that LNG projects are at various stages, with ongoing work in the U.S., Indonesia, and Oman, allowing for flexibility in resource allocation [84][86] Question: What is the outlook for the ammonia industry? - Management confirmed a strong ammonia market with several projects focused on fertilizer usage, indicating a positive outlook for this segment [99]