Talen Energy and Wendy's have been highlighted as Zacks Bull and Bear of the Day

For Immediate Release

Chicago, IL – August 21, 2025 – Zacks Equity Research shares Talen Energy Corp. TLN as the Bull of the Day and The Wendy's Co. WEN as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Union Pacific Corp. UNP and Canadian National Railway Co. CNI.

Here is a synopsis of all four stocks.

Bull of the Day:

Talen Energy Corp. is a leading independent power producer that’s a direct long-term investment in the growing relationship between artificial intelligence and nuclear energy.

Wall Street has jumped into Talen, which already has a nuclear power deal with AI hyperscaler Amazon, and other nuclear energy stocks because TLN and its peers are part of a small group of companies ready to power the energy-hungry AI boom.

U.S. electricity supply will have to expand more than 5x faster than the prior two decades to meet demand, according to AI industry projections.

Alongside nuclear energy, the rapid build-out of AI data centers is also fueling surging natural gas demand. Talen made a blockbuster natural gas deal in the middle of July that will increase its annual generation by 50%.

This backdrop is why TLN stock soared 160% in the past year, crushing Nvidia and the Nasdaq.

Talen's recent pullback sets up a better buying opportunity for one of the leading players in nuclear energy that's prepared to fuel the AI age.

Buy Nuclear as Part of Your AI Stock Portfolio

The U.S. government aims to quadruple nuclear energy capacity by 2050. It is spurring nuclear energy expansion by cutting red tape, increasing tax incentives, partnering with next-gen nuclear energy companies, and beyond.

AI hyperscalers Meta, Amazon, Alphabet, and Microsoft have all rushed to secure more nuclear power and made deals to accelerate the development of next-generation nuclear technology, supported by their collective trillion-dollar balance sheets.

The reason is simple: without more power, the AI boom might be doomed to die on the vine.

AI marks a paradigm shift for energy demand after technology companies drove economic and stock market expansion in the post-financial crisis world without straining the grid. U.S. electricity generation remained roughly flat between 2010 and 2023.

Large data centers can consume nearly as much electricity as a midsize city because AI platforms like ChatGPT use at least 10x the energy of a typical Google search.

Data centers could jump from 4% of total U.S. power demand in 2023 to over 12% in 2030. Data center demand is already straining the grid and sending prices soaring.

Prices from the biggest U.S. power auction, held by grid operator PJM Interconnection in July, surged 22% to new all-time highs for 2026/2027 as demand outpaces supply—this came after prices skyrocketed over 800% last summer.

No one knows which AI hyperscalers will eventually dominate. What everyone is sure of is that the AI boom will be fueled by nuclear energy and natural gas.

Natural gas plants are far more cost-effective, and new construction will be much quicker as hyperscalers wait for nuclear plants to break ground at the end of the decade. And natural gas already accounts for by far the largest portion of U.S. electricity generation at 43%, vs. nuclear’s 20%.

Talen: Why the Amazon Partner Is a Must-Buy Stock

Talen Energy is an independent power producer (IPP) and a leading energy infrastructure company. Unlike traditional utility firms, TLN owns and operates facilities that generate electricity, which Talen then sells to utilities or major consumers such as Amazon.

Talen owns and operates about 10.7 gigawatts (GW) of power generation capacity across five states, including 2.2 GW of carbon-free nuclear via its Susquehanna plant. Talen boasts that Susquehanna generates enough carbon-free nuclear energy to power 2 million homes. Its portfolio also includes a significant amount of natural gas.

The company was at the vanguard of the relationship between AI and nuclear. Talen announced plans to develop data centers at the Susquehanna nuclear plant back in July 2021.

The company sold its Cumulus data center campus to Amazon last year and landed a long-term power agreement with AWS. TLN in June 2025 expanded its relationship with Amazon to provide 1,920 megawatts of carbon-free nuclear power through at least 2042.

Talen will supply electricity to Amazon to support AI and other cloud technologies at Amazon’s data center campus adjacent to Susquehanna, “with the ability to deliver to other sites throughout Pennsylvania.” On top of that, the expanded partnership will see Talen and Amazon explore building next-gen small modular reactors.

Talen stock soared to records in the middle of July after it announced a deal to buy two natural gas plants (one in Pennsylvania and one in Ohio).

Talen’s $3.8 billion deal is expected to boost its free cash flow per share by over 40% in 2026 and 50% through 2029. The acquisition also critically expands its annual generation capacity by 50% from 40 TWh to 60 TWh. The deal is set to close later this year.

Talen’s AI-Boosted Growth Outlook

Talen crushed our Q2 earnings estimate in early August, posting adjusted quarterly earnings per share (EPS) of $1.50 vs. our estimate of a -$1.13 loss. Its operating revenue jumped 29% YoY to $630 million, topping our $480.7 million estimate.

The nuclear power and natural gas company is projected to grow its revenue by 15% in 2025 and 62% next year to climb from $2.12 billion in 2024 to nearly $4 billion next year.

TLN’s adjusted EPS are projected to slip 30% YoY in 2025 following first-half declines. But its earnings are projected to surge 187% in Q3, 122% in the fourth quarter, and 234% next year.

Talen’s earnings estimates have popped since its release, including a 37% jump for 2026, helping it earn a Zacks Rank #1 (Strong Buy).

TLN is optimistic about its growth outlook, which is driven by its “ability to offer reliable, grid-supported and regionally diverse capacity to hyperscale data centers and other large commercial off-takers.”

Buy AI Energy Stock Talen On the Dip?

Talen stock has jumped 160% in the past year, including a 50% run in the past three months. Despite Talen’s 12-month run, investors can still get in near the ground floor since the AI boom and energy expansion/transition are just starting.

TLN stock has dropped 10% from its early-August peaks to slide below its 21-day. The nuclear energy company has fallen from overheated RSI levels to roughly neutral, and it could hold its ground near its July breakout levels.

Some traders might want to wait for a possible pullback to its 50-day moving average before diving into Talen.

Overall, Wall Street is very bullish on the stock, with 11 of the 12 brokerage recommendations Zacks has sitting at “Strong Buys.”

On top of that, Talen’s valuation levels have improved on the back of its soaring earnings outlook. Its price-to-earnings to growth (PEG) ratio of 1.5 marks a 70% discount to its highs and solid value compared to the S&P 500.

Bear of the Day:

The Wendy's Co. stock has tanked over the last few years as its earnings outlook plummets amid an array of headwinds.

Why Investors Should Stay Away from WEN Stock

Wendy's is a fast-food chain renowned for its square hamburgers. The company, which was founded back in 1969 by Dave Thomas, remains committed to making its food fresh to order.

WEN operates across more than 7,000 restaurants worldwide, competing against the likes of McDonald's and Burger King. The burger chain remains a standout in the larger restaurant industry, but its struggles are growing amid changing consumer habits and more.

Consumers have more options than ever before, and more people are trying to eat healthier. On top of that, fast-casual giants like Chipotle and casual titan Chili’s are gaining momentum.

Wendy’s is suffering as its same-restaurant sales fade in 2025, driven by reduced customer traffic. Plus, rising commodity prices and labor costs remain significant headwinds.

WEN’s earnings estimates dropped again following its disappointing Q2 release on August 8.

WEN’s adjusted consensus earnings per share (EPS) estimates have fallen 16% for Q3, 21% for Q4, and 8% for fiscal 2026. Its negative earnings revisions earn the stock a Zacks Rank #5 (Strong Sell) and extend a downward spiral that began several years ago.

The burger company’s adjusted earnings are projected to fall 11% YoY on 3.4% lower sales. And its Retail – Restaurants industry sits in the bottom 19% of roughly 250 Zacks industries.

WEN stock has tumbled 37% in 2025, lagging far behind its industry’s -3% drop and McDonald's +8% jump. This is part of a 53% decline over the past five years, while its industry jumped 27% and MCD surged 48%. Therefore, it might be best for investors interested in the restaurant business to look elsewhere.

Additional content:

2 Dividend-Paying Stocks from the Railroad Industry You Should Count On

Prospects of the Zacks Transportation - Rail industry’s participants are being weighed down by challenges like tariff-induced economic uncertainties, persistent inflation and concerns pertaining to lingering supply-chain disruptions. Geopolitical woes represent further challenges. Most industry players are looking to drive their bottom line amid the headwinds through cost reduction.

Partly due to these headwinds, the industry has declined 5.3% over the past year against the S&P 500 Index’s 15.6% gain. The broader Zacks Transportation sector has plunged 7.9% in the said time frame.

Despite the challenges surrounding the industry, some railroad companies like Union Pacific Corp. and Canadian National Railway Co. have consistently paid dividends to their shareholders, thus highlighting their pro-shareholder stance.

Dividend growth stocks generally belong to mature companies, which are less susceptible to significant market swings, and act as a hedge against uncertainty-induced stock market volatility, as is the case currently. They offer downside protection with their consistent increase in payouts.

Additionally, these companies generally have strong fundamentals like a sustainable business model, a long track of profitability, rising cash flows, good liquidity and a strong balance sheet.

How to Pick Stocks with Solid Dividend Payouts?

Investing in dividend stocks is a prudent strategy that offers a dual advantage: steady income and a cushion against market volatility. It's no wonder investors actively seek companies with a consistent and growing dividend history. These stocks provide a reliable income stream, acting as a buffer during market downturns and contributing to overall portfolio stability.

To guide investors interested in the railroad industry, we came up with certain parameters using the Zacks Stocks Screener. We shortlisted transportation stocks based on the following:

a) A dividend payout ratio of less than 60% (the dividend payout ratio — dividends paid/net income — gives the proportion of earnings paid out as dividends to shareholders. A payout ratio below 60 looks quite sustainable).

b) A dividend yield of greater than 2% (dividend yield denotes the percentage of a company’s share price that it shells out as dividends annually).

The selected stocks have exhibited dividend growth in the past five years, apart from currently carrying a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Union Pacific: Headquartered in Omaha, NE, Union Pacific, through its subsidiary, Union Pacific Railroad Company, operates in the railroad business in the United States. Currently, UNP has a market capitalization of $130.52 billion.

UNP’s quarterly dividend of $1.38 ($5.52 annualized) per share, which gives it a 2.44% yield at the current stock price. The company’s payout ratio is 47% of its earnings at present. The five-year dividend growth rate is 7.19%. (Check Union Pacific’s dividend history here).

Union Pacific Corporation dividend-yield-ttm | Union Pacific Corporation Quote

UNP has paid dividends on its common stock for 126 consecutive years, reflecting its pro-shareholder approach. Union Pacific’s consistent initiatives to reward its shareholders through dividends and share repurchases look encouraging. In 2022, UNP paid dividends worth $3.16 billion and repurchased shares worth $6.28 billion.

In 2023, the company returned $3.9 billion to its shareholders through dividends ($3.2 billion) and buybacks ($0.7 billion). During 2024, UNP paid $3.21 billion in dividends and repurchased shares worth $1.50 billion. During the first half of 2025, UNP paid $1.59 billion in dividends and repurchased shares worth $2.67 billion.

For 2025, Union Pacific's long-term capital allocation strategy remains unchanged, with a capital plan of $3.4 billion and share repurchases ranging from $4 to $4.5 billion.

Canadian National: Based in Montreal, Canada, Canadian National is involved in the rail, intermodal, trucking, and marine transportation and logistics business in Canada and the United States. Currently, CNI has a market capitalization of $58.19 billion.

CNI’s quarterly dividend leads to $2.59 per share (annualized), which gives it a 2.78% yield at the current stock price. This company’s payout ratio is 50% of its earnings at present. The five-year dividend growth rate is 7.31%. (Check Canadian National’s dividend history here).

Canadian National Railway Company dividend-yield-ttm | Canadian National Railway Company Quote

CNI’s consistent efforts to reward its shareholders via dividends and buybacks are encouraging and highlight the company's financial strength. In 2022, CNI paid dividends of C$2.00 billion and repurchased shares worth C$4.71 billion. In 2023, CNI paid dividends of C$2.07 billion and repurchased shares worth C$4.55 billion. During 2024, CNI paid dividends of C$2.14 billion and repurchased shares worth C$2.60 billion.During the first half of 2025, CNI paid dividends of C$1.11 billion and repurchased shares worth C$444 million.

Such shareholder-friendly moves indicate the company’s commitment to creating value for shareholders and underline its confidence in its business.

Why Haven't You Looked at Zacks' Top Stocks?

Since 2000, our top stock-picking strategies have blown away the S&P's +7.7% average gain per year. Amazingly, they soared with average gains of +48.4%, +50.2% and +56.7% per year.

Today you can access their live picks without cost or obligation.

See Stocks Free >>

Media Contact

Zacks Investment Research

800-767-3771 ext. 9339

https://www.zacks.com

Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.

Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index.Visit https://www.zacks.com/performance  for information about the performance numbers displayed in this press release.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research