8. Public Service Enterprise Group Incorporated (NYSE:PEG)
Number of Hedge Fund Holders: 42
Next on our list of the Best Nuclear Energy Stocks is Public Service Enterprise Group Incorporated (NYSE:PEG), a predominantly regulated energy company that engages in the provision of electric and gas services. The company is involved in nuclear energy through its subsidiary PSEG Power, which owns and operates merchant nuclear-generating assets.
Public Service Enterprise Group Incorporated (NYSE:PEG) reported an adjusted EPS of $0.84 in Q4 2024, beating market estimations. Moreover, its full-year adjusted EPS of $3.68 was at the top of its 2024 guidance range, marking the twentieth consecutive year that it has met or exceeded management’s non-GAAP operating earnings guidance to investors. PSEG had a total available liquidity of $2.6 billion at the end of 2024, including approximately $100 million of cash on hand. The energy company is an avid dividend payer and recently announced a $0.12 per share increase in its annual common dividend to an indicative annual rate of $2.52 per share for 2025. This is PSEG’s fourteenth consecutive annual dividend increase and the company has paid a common dividend to its shareholders for 118 years.
Public Service Enterprise Group Incorporated (NYSE:PEG) has responded to the data center boom by raising its 2025-2029 capital spending plan to $22.5 billion to $26 billion, an increase of $3.5 billion from its prior five-year plan. The company continues to invest in nuclear and recently finalized an agreement with Lotus Resources, which along with prior deals secures the purchase of at least 2.3 million pounds of uranium from the Kayelekera Uranium Project in Malawi, covering the period from 2026 to the end of 2032.
Sound Shore Management stated the following regarding Public Service Enterprise Group Incorporated (NYSE:PEG) in its Q3 2024 investor letter:
“In recent letters we have discussed the resurgence of nuclear power as a base load electricity source and the opportunities our team has uncovered in the power generation space. Public Service Enterprise Group Incorporated (NYSE:PEG), better known as PSE&G, is another example and one of our strongest contributors for the three-month period. The company is a “hybrid” regulated utility and unregulated nuclear power generator that we were able to purchase at an attractive price relative to its earning power. PSE&G’s well managed, regulated utilities provide consistent returns that we expect will grow steadily with their rate bases. As well, we believe there is unappreciated value in their nuclear plants which sit in an unregulated subsidiary that can capture the upside potential of increased power prices. Carbon-free and reliable electricity commands a premium in the marketplace, as seen in recently announced 20-year long data center sales contracts by peer companies. Presently, PSE&G is in discussions to do the same. Our projections estimate this provides a 20% or more upside to earnings for PSE&G from here over the next few years.”
