BWX Technologies, Inc. (BWXT): A Bull Case Theory

We came across a bullish thesis on BWX Technologies, Inc. on Rigatoni Capital’s Substack. In this article, we will summarize the bulls’ thesis on BWXT. BWX Technologies, Inc.'s share was trading at $202.46 as of October 14th. BWXT’s trailing and forward P/E were 57.85 and 44.05 respectively according to Yahoo Finance.

BWX Technologies (BWXT) is a specialized nuclear technology and services company, spun off from Babcock & Wilcox in 2014–2015, now focused on naval nuclear reactors, nuclear fuel, and commercial nuclear maintenance. The company operates under high regulatory oversight with long-term government contracts, positioning it as a critical player in defense, space, and clean-energy infrastructure.

BWXT reported a record $6 billion backlog, up 70% year-over-year, with government operations driving double-digit EBITDA and EPS growth at 22.6% margins, while commercial operations saw revenue growth tempered by margin compression from investments and mix shifts. Q2 2025 revenue was $764 million (+12% YoY), adjusted EBITDA $146 million (+16%), EPS $1.02 (+24%), and free cash flow $126 million, with a book-to-bill ratio of 2.2x organically.

Strategic developments include a $2.6 billion, eight-year naval reactor components agreement, expansion of depleted uranium production, microreactor manufacturing, and progress on NASA’s DRACO space-nuclear program. The medical isotope business continues double-digit growth, while commercial nuclear initiatives, including AP1000 components and SMR pressure vessels, position BWXT for future expansion. Full-year guidance was raised, with revenue projected around $3.1 billion, EBITDA $565–575 million, EPS $3.65–3.75, and free cash flow $275–285 million, reflecting strong underlying momentum.

While dividends and modest share buybacks provide shareholder support, speculation about potential U.S. government investment has fueled the stock, driving a ~71% gain over the past 12 months. Despite impressive fundamentals and strategic positioning, the current valuation appears elevated, suggesting that new investors may consider waiting for a pullback before entering, acknowledging the upside potential tied to government engagement and BWXT’s pivotal role in nuclear defense, space, and clean-energy infrastructure.

Previously we covered a bullish thesis on Northrop Grumman Corporation (NOC) by Daan Rijnberk in March 2025, which highlighted the company’s leadership in defense technologies, strong backlog, and robust capital returns. The company's stock price has appreciated approximately by 27.75% since our coverage. The thesis still stands as Northrop’s long-term defense positioning remains strong. Rigatoni Capital shares a similar focus but emphasizes BWX Technologies’ specialization in nuclear propulsion and naval reactors.

BWX Technologies, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 52 hedge fund portfolios held BWXT at the end of the second quarter which was 52 in the previous quarter. While we acknowledge the potential of BWXT 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.

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Disclosure: None.