Utilities Up After Constellation, Google Deal — Utilities Roundup

Constellation Energy (CEG) signed a deal with Alphabet's Google to supply 890 MW of nuclear power, highlighting its role in powering AI growth for tech giants. CEG operates outside regulated utilities, offering direct power sales to companies like Microsoft, Meta, and Amazon. Its scale, diverse energy portfolio, and long-term contracts support growth, though its stock remains 25% below 2025 highs.

Vistra Corp (VST), a nuclear and natural gas power producer, has seen its stock fall over 30% from its 2025 high. The U.S. Department of Energy plans to lend VST $4.2 billion to upgrade three nuclear plants, aiming to increase power output. The loan could reduce VST's interest costs and support its revenue growth. VST's stock rose 6% in premarket trading after the announcement, but loan terms are not yet final, and regulatory issues persist.

Samsung and five affiliates are investing $1 billion in Helix Digital Infrastructure, a data center development firm founded by KKR and backed by Nvidia. Samsung's investment includes $500 million from Samsung Electronics, with other affiliates contributing the rest. Helix aims to secure power capacity and network connections for data centers, giving Samsung exposure to AI infrastructure beyond hardware.

NRG Energy (NYSE: NRG) shares rose 5.69% on strong earnings and guidance. The company reported $1.12B in quarterly operating cash flow and $30.7B in annual revenue, but faces regulatory delays from FERC on PJM's Reliability Backstop Procurement plan, impacting near-term cash flow. Analysts adjusted price targets, with Morgan Stanley at $159 and Scotiabank at $162, while the average target remains around $191–$194. NRG is also focusing on AI-driven demand growth.

Constellation Energy, Google, and the U.S. DOE announced a 20-year power purchase agreement for 890 MW of nuclear uprates at 11 reactors, with Constellation investing $4.3B. The DOE also committed up to $4.2B for Vistra's nuclear upgrades, adding 433 MW of capacity. Both deals aim to boost existing nuclear capacity to meet rising electricity demand, particularly in the PJM Interconnection.

Vistra Corp. (VST) stock rose 4.21% after the U.S. Department of Energy (DOE) announced a conditional $4.2 billion loan for nuclear plant upgrades. The company's stock has surged from $140.73 to $167.25 in a month. VST reported quarterly revenue of $4.017 billion, EBITDA of $1.304 billion, and net income of $305 million. Analysts from Siebert Williams and BMO Capital have given bullish ratings with price targets of $202 and $210, respectively.