As AI computing power demand becomes the strongest commercial driver of nuclear energy growth, nuclear power generation is expected to hit a record high in 2025.
IEA data shows that about 70 gigawatts of new nuclear capacity is currently under construction globally, and investment in new reactor construction and refurbishment is expected to exceed $70 billion for the first time in 2025. Amid this nuclear renaissance wave, Cameco (CCJ) and BWX Technologies (BWXT), with their unique positions in the industry chain, have become the most notable nuclear investment targets.
Cameco: Direct Beneficiary of the Uranium Price Cycle – A Value Play Under Resource Constraints
Cameco’s core logic lies in its position at the very front of the global nuclear fuel supply chain – uranium mining. The company is currently the world’s second largest uranium miner, accounting for about 15% of global production in 2025. For Cameco investors, the uranium price is the single most important variable.
Over the past year, spot uranium prices have rebounded strongly from their lows. Goldman Sachs expects the uranium price to rise to as high as $91 per pound by the end of 2026, the global uranium supply gap is projected to widen to 32% by 2045. Cameco has resumed production at previously shuttered mines to meet strong demand. In 2025, its uranium output beat expectations at 21 million pounds, with full year revenue of about $3.5 billion (up 11% YoY) and adjusted EBITDA up 26% YoY.
However, the investment thesis for Cameco is not without concerns. Expected uranium deliveries for 2026 are 29-32 million pounds, down from 33 million pounds in 2025, while production is expected to edge down slightly to 19.5-21.5 million pounds. More noteworthy is its valuation: with an enterprise value of approximately $61.5 billion, it trades at about 33 times this year’s adjusted EBITDA – far above the traditional valuation range for cyclical stocks. Cameco’s risk lies in its high dependence on the uranium price – if uranium price increases fall short of expectations or demand growth slows, the high valuation could face significant downward pressure. That said, the 2023 joint acquisition of Westinghouse Electric with Brookfield provides a diversification buffer beyond uranium mining, with Westinghouse targeting a 6%-10% compound annual growth rate in profits over the next five years.
BWX Technologies: A Moat of Defense Contracts + Backlog Builds a Certainty Advantage
Unlike Cameco’s heavy reliance on commodity cycles, BWX plays the role of the “picks and shovels” provider in the nuclear industry. As the only large scale producer of specialized nuclear components, fuel systems, and naval reactor systems in North America, BWX enjoys two hard to replicate moats: first, its exclusive position in the defense sector – it is virtually the sole supplier of naval nuclear propulsion components for the U.S. Navy; second, its regulatory barriers – it is one of the few companies authorized to work with regulated nuclear materials, including HALEU and TRISO fuel.
BWX’s financial performance fully reflects the value of this unique positioning. As of the end of 2025, the company’s backlog reached $7.3billion, up50%, $2.6 billion with the U.S. Navy for nuclear reactor components, spanning the next eight years, provides high revenue visibility. In addition, BWX is rapidly expanding its nascent small modular reactor (SMR) business – the global SMR market is expected to grow from about $6.7 billion in 2025 to $9.9 billion in 2026, a compound annual growth rate of 47.6% – and incremental SMR orders could further open up growth opportunities. Analysts expect the company’s revenue and adjusted EBITDA to grow at CAGRs of approximately 13% and 12%, respectively, from 2025 to 2028.
However, BWX also faces valuation challenges. Its forward P/E ratio is near 53x, with high growth expectations already fully priced in. Its dividend yield is only about 0.4%, offering limited appeal to income-focused investors in the current interest rate environment. Moreover, the commercialization of SMRs is still in progress, and factors such as complex regulatory approval processes and high capital expenditures have led to market disagreement over the timing of actual profit delivery.
Conclusion
Overall, the core investment logic for nuclear power rests on an irreversible structural transformation of the energy sector. Cameco and BWXT each occupy different links in the nuclear supply chain – fuel supply and core equipment manufacturing. The two companies are not mutually exclusive alternatives but rather complementary core holdings in a nuclear investment portfolio. Investors may choose between them based on their own preferences for cyclical risk versus certainty premiums.
