Morgan Stanley’s Best Stock Picks: 15 Stocks To Own For 2025

8. Constellation Energy Corporation (NASDAQ:CEG)

Number of Hedge Fund Holders In Q2 2024: 71

Share Price Target Upside: 18%

Share Price Target: $232

Constellation Energy Corporation (NASDAQ:CEG) is the biggest green energy power generation firm in the US. This provides it with a wide moat when it comes to artificial intelligence. Estimates show that AI power demand globally could sit at 800 Twh, which makes it critical to ensure that clean energy is powering the revolutionary new technology. Constellation Energy Corporation (NASDAQ:CEG) has 33,000 megawatts of power generation capacity in its portfolio, and the firm can see further headwinds from US government spending through the Inflation Reduction Act (IRA). Constellation Energy Corporation (NASDAQ:CEG) generates a whopping 22 gigawatts of electricity from nuclear power, which also places it in a favorable position to benefit from any future growth in the US nuclear industry. However, its exposure to clean energy also means that if investors perceive tighter future capital conditions, then the shares can suffer. This was also the case at September’s start when worries of a recession and delayed rate cuts led to a 9.6% share price drop.

ClearBridge Investment mentioned Constellation Energy Corporation (NASDAQ:CEG) in its Q2 2024 investor letter. Here is what the fund said:

“Constellation Energy is primarily a nuclear generation company and is the largest producer of carbon- free electricity in the U.S., serving states including New York, Illinois, Maryland, Pennsylvania and New Jersey. The company’s combined generation capacity is more than 32 GW and 90% of annual output is carbon free. Constellation has been a beneficiary of AI and subsequent power demand as its 24/7 base load nuclear generation can get premium contracts.”