Constellation Energy Is Down 29% From Its Peak. Is the Nuclear Bull Case Still Intact?

Key Stats for Constellation Energy (CEG)

• 52-Week Range: $228.63 to $412.70
• Street Mean Target: $348.30
• NTM P/E: ~21x
• LTM EBIT Margin: 15%
• Fwd 2-Yr EPS CAGR: ~19%
• Market Cap: ~$92 billion

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From AI Darling to Pullback Candidate: What Happened to CEG?

Constellation Energy (CEG) rode one of the most powerful narratives in the market over the past few years. As AI infrastructure buildout accelerated and data center operators scrambled for reliable, around-the-clock clean power, investors quickly realized that nuclear energy sat in a uniquely advantageous position.

Constellation, as the largest nuclear power producer in the United States, became the obvious beneficiary. The stock ran from the low $100s to a peak above $400, and then the market cooled on the trade.

What drove the pullback was a mix of valuation anxiety, noise around regulatory timelines, and a broader rotation out of last year’s energy winners. The stock now sits nearly 30% below its highs, trading around $263, and well below the Street’s mean target of around $348.

The underlying business, though, has kept executing. Q2 2026 adjusted earnings came in at $2.55 per share, up from $1.91 a year earlier.

Revenues rose 23% year over year to $7.5 billion, reflecting the completed Calpine acquisition, which added natural gas and geothermal assets to Constellation’s nuclear-led generation fleet.

CEO Joe Dominguez raised full-year guidance by $0.50 per share following the quarter, pointing to steady progress on restarting the Crane Clean Energy Center, now slated to come back online in 2027.

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The Earnings Trajectory Is Hard to Ignore

Here is the part of the CEG story that doesn’t get enough attention when people focus only on the stock price. Constellation’s earnings per share went negative as recently as 2021, when the company was first spun off from Exelon.

Since then, the business has compounded aggressively, reaching $9.39 in adjusted EPS for full-year 2025. What analysts expect from here is even more striking.

Consensus estimates point to EPS climbing toward around $12 in 2026, then continuing to step up toward $22 by 2030 as new long-term contracts ramp and the Crane restart adds incremental generation capacity.

During Q2 alone, Constellation signed roughly 920 megawatts of new nuclear power purchase agreements with an average contract duration of 18.5 years, including an inaugural nuclear PPA with Walmart.

Deals like that do not get signed by companies whose customers are uncertain about the long-term value of nuclear power. Management also deployed $2.2 billion in share repurchases during the quarter, which reflects real balance sheet confidence even after absorbing Calpine.

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What the TIKR Valuation Model Suggests

The model assumes revenue growing at around 6.5% annually through the forecast period, with net income margins expanding toward 16% as the contract mix improves and nuclear production tax credits, which adjust for inflation, provide a reliable earnings floor.

The P/E multiple compresses gradually in the mid case, around 4% annually, which reflects the reality that CEG ran to a stretched valuation at its peak and some of that premium needs to normalize as earnings catch up.

The mid-case target sits at around $450, implying roughly 14% annualized returns from current levels. Stretch the horizon out to 2034, and the mid-case forecasted return reaches around 107% at a roughly 9% IRR.

The Street’s mean target of around $348 implies about 32% upside on its own, and the broad analyst consensus remains constructive, with most firms maintaining buy-equivalent ratings.

Should You Buy CEG Stock?

The bull case is straightforward. Nuclear power is structurally scarce, demand from AI infrastructure is growing fast, and Constellation is signing contracts measured in decades rather than quarters.

The Crane restart in 2027 adds capacity at a moment when grid tightness is becoming a real constraint across several U.S. regions, and the inflation-linked production tax credits provide earnings stability independent of spot power prices. A stock trading 29% below its peak, with earnings estimates that keep moving higher, is at least worth taking seriously.

The bear case centers on execution risk and the debt load from Calpine. Restarting a nuclear plant is technically complex, and any delays at Crane would reset sentiment quickly. The multiple CEG commanded at its peak was pricing in a lot of good news, and investors who bought anywhere near $400 are still sitting on meaningful losses.

How the story develops from here depends heavily on the next few contract announcements and whether the Crane timeline holds.

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Disclaimer:

Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!