Energy, Utilities & Mining Pulse: Investors Asking: Seven Key Debates on Power Amid the Pullback on the Theme in the Past Month

Research evidence excerpt

Energy, Utilities & Mining Pulse: Investors Asking: Seven Key Debates on Power Amid the Pullback on the Theme in the Past Month

cycle and gas single cycle plants, along with battery

storage systems. From this earnings season, we look for color on the progression on

these fundamental factors for the remainder of the decade. Given recent pricing

pressure, we continue to highlight AGX, given the stock’s position in the gas power

generation EPC market, as we see high demand for the construction of combined cycle

gas plants. With the continued focus for power generation, we see AGX’s position as one

of the larger EPCs in CCGT as an advantage over the next several years as power demand

remain in-focus.

Is the nuclear story losing momentum or do we remain constructive? What are

catalysts that we are focused on, and what stocks do we recommend at these levels?

While we have seen nuclear momentum fade in recent months, we remain constructive

on the outlook for the sector given several positive secular trends such as government

support, growing power demand, and an improving regulatory environment. We remain

focused on announcements related to new large-scale reactors moving towards a final

investment decision (FID), particularly in the US, and note that the recently announced

$17.5bn in funding to support supply chains for five new projects could create a

pseudo-FID, in our view, as project sites are announced. Separately, we continue to

watch the progress of new construction efforts on a variety of small modular reactors

(SMR), with a focus on companies providing updated cost estimates. Additionally, we

look at the first SMR companies signing final PPA agreement as another key catalyst to

watch. We continue to favor CCJ at these levels, with the company now trading near