Constellation Energy Corporation (CEG): A Bull Case Theory

We came across a bullish thesis on Constellation Energy Corporation on Stock Analysis Compilation’s Substack. In this article, we will summarize the bulls’ thesis on CEG. Constellation Energy Corporation's share was trading at $317.88 as of July 21^st. CEG’s trailing and forward P/E were 33.50 and 33.11, respectively according to Yahoo Finance.

Constellation Energy (CEG), spun out of Exelon Energy in January 2022, is the largest independent power producer in the U.S., operating over 55% of the nation’s unregulated nuclear capacity and delivering more than 180TWh of carbon-free electricity annually, avoiding approximately 120 million metric tons of CO2 emissions.

In the June quarter, CEG signed a 20-year virtual power purchase agreement with Meta, its second major deal with a technology giant, to supply 1.1GW of nuclear power from its Clinton Plant in Illinois starting in 2027. Though market attention focused on pricing—estimated at $80–90/MWh and below the economics of behind-the-meter deals—the strategic value lies in CEG’s ability to secure long-term contracts across its fleet, which currently earns just under $45/MWh through Inflation Reduction Act production tax credits.

Each incremental 1GW contracted at $90/MWh could lift earnings per share by about $0.85 against Bloomberg’s 2025 consensus EPS of $9.41. Meta’s willingness to pay roughly twice the spot power price highlights nuclear’s premium for reliable, carbon-free baseload generation, even without the cost benefits of co-located infrastructure. CEG is also enhancing capacity through 30MW of uprates and exploring the deployment of small modular reactors (SMRs), leveraging the land value of its existing nuclear sites in receptive communities.

The Meta contract reinforces CEG’s position as the leading supplier of clean, reliable power, underpinned by a fleet with significant potential to drive earnings growth through long-term contracts, capacity upgrades, and SMR development, offering a compelling structural opportunity in the transition to carbon-free energy

Previously, we covered a bullish thesis on Constellation Energy Corporation (CEG) by jackandjillonthehill in March 2025, which highlighted margin expansion from rising electricity prices, fast start pricing, and AI-driven demand for reliable nuclear power. The stock has appreciated about 45% since then as these drivers played out. Stock Analysis Compilation shares a similar view but emphasizes CEG’s earnings growth through long-term contracts with Meta.

Constellation Energy Corporation is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 83 hedge fund portfolios held CEG at the end of the first quarter which was 85 in the previous quarter. While we acknowledge the potential of CEG as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.

Disclosure: None.