10 AI News Investors Shouldn’t Miss

3. Constellation Energy Corporation (NASDAQ:CEG)

Number of Hedge Fund Holders: 78

Constellation Energy Corporation (NASDAQ:CEG) is an energy provider specializing in clean, carbon-free energy solutions. This top Goldman Sachs’s Phase 2 AI Stock benefits from the growing demand for electricity from large AI data centers. On December 12, Bank of America analyst Ross Fowler upgraded Constellation Energy Corporation (NASDAQ:CEG) to “Buy” from neutral and raised his price target by $32 to $269. The firm sees potential in Constellation Energy, anticipating shares to jump 13.7% over the next year.

Due to grid operator PJM Interconnection’s power deficit, the company will continue to thrive considering it is PJM’s largest supplier of clean baseload power. The firm strongly believes that data centers are key to the stock’s upside. With companies looking for clean energy solutions to power data centers and drive AI growth, Constellation announced earlier this year its plans to restart operations at Three Mile Island. Even though the company could see downside from declining power prices, Fowler said that should be offset by tax credits that are anticipated to remain due to bipartisan support.

“We believe CEG offers a unique investment opportunity, with sustained double-digit growth, an asset mix and business model that provides clean, baseload generation, and a compelling valuation relative to peers. We believe CEG is in the best position to prosper from rising demand, tightening supply, and likely soon to come regulatory clarity. This potential is not reflected in its current share price. As such it is undervalued.”

– Fowler wrote to clients on Thursday.