Key Stats for Constellation Energy Stock
- This Week’s Performance: 10%
- 52-Week Range: $161 to $413
- Valuation Model Target Price: $351
- Implied Upside: 22%
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What Happened?
Constellation Energy stock rose about 10% this week, recently trading near $288 per share, as investors responded to major new data center power agreements and renewed confidence in long-term electricity demand tied to artificial intelligence infrastructure.
The move reflects improving sentiment around contracted capacity growth rather than speculative momentum.
Shares moved higher after Constellation announced that its Calpine unit signed a new 380-megawatt agreement with CyrusOne to power a Texas data center, along with an exclusive agreement for an additional 380 MW in Phase 2.
Combined with the previously announced 400 MW agreement for the Thad Hill Energy Center, total contracted power for CyrusOne data centers in Texas now exceeds 1,100 MW.
These agreements expand forward revenue visibility and reinforce Constellation’s role as a core supplier to hyperscale infrastructure operators.
Analyst sentiment also supported the advance. On January 20, Wells Fargo lowered its price target from $478 to $460 but maintained an Overweight rating, noting that Constellation remains its “Best IPP Idea” with multiple data center deals and asset opportunities in the pipeline. Even after the reduction, the firm continues to highlight significant upside potential over time.
Regulatory headlines surrounding potential PJM capacity market pricing adjustments remain a factor, but this week’s rally suggests investors are focusing more on long-term contracted demand growth and structural increases in U.S. electricity consumption.
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Is Constellation Energy Undervalued?
Under valuation assumptions, the stock is modeled using:
- Revenue Growth (CAGR): 4.1%
- Operating Margins: 20.0%
- Exit P/E Multiple: 26x
Revenue growth reflects steady load expansion from commercial and industrial customers, particularly hyperscale data centers that require consistent baseload electricity.
While top-line growth remains in the low single digits, structural increases in electricity demand tied to artificial intelligence infrastructure support long-term volume stability.
Forward estimates imply 23.7% EBIT CAGR over the next two years, highlighting operating leverage as the primary earnings engine.
Higher realized power prices, capacity market payments, and long-term power purchase agreements can expand margins as fixed nuclear operating costs are spread across stable generation output.
The valuation model estimates a target price of $350.75, which rounds to $351, implying roughly 22% total upside over about 1.9 years, or 11% annualized.
With Net Debt to EBITDA at 0.83x and net debt near $5.1 billion, the balance sheet remains strong and supports capital flexibility.
At current levels, Constellation Energy appears undervalued, with performance into 2026 likely driven by continued data center contracting, durable power pricing, operating leverage, and disciplined capital allocation.
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