The One Company Set to Dominate the New SMR Market

Artificial intelligence (AI) is one of the most transformative technologies to emerge in decades. It has already changed the way we do business, and it’s only getting started. AI’s computing power requirements are doubling every 100 days.

Data centers alone are expected to use 1,000 terawatt-hours (TWh) by 2026… That’s enough energy to light 1 billion homes, about half of the houses on the entire planet.

We need lots of electricity and we need it fast. Nuclear power is the only option to produce the volume of electricity a modern economy needs cheaply and in an environmentally friendly way.

It produces less greenhouse gases and waste than wind power and is much more efficient than both wind and solar. The main problems with producing nuclear power have been cost and time…

A modern nuclear reactor with 1 kilowatt of capacity typically costs around $5,366 to build. At that rate, a 1-gigawatt reactor would cost $5.4 billion. The equivalent wind farm costs $1,980 per kilowatt and a new oil plant costs $912 per kilowatt.

So nuclear reactors are more expensive to build… but the costs are upfront. Reactors run at capacity more often than wind farms or fossil fuel plants. They also require much less fuel, need less frequent refueling, and don’t need consumable parts (like wind turbine blades).

So in the long term, the costs become much cheaper compared with other energy sources.

But the other issue is time. Building a traditional reactor takes a lot of time. The parts are large and must be built perfectly to avoid meltdown…

It took France, a country that gets 70% of its power from nuclear energy and even exports electricity to its neighbors, 20 years to build its 56 reactors across 18 commercial power plants. The project started in 1972 and finished in 1992… in December 2024, France connected another nuclear reactor to their national electricity grid to bring the total number of reactors for the country to 57.

Even adding a reactor to an existing plant can be time-consuming. In Georgia, a project to add two new reactors to the Vogtle plant began in 2009 and didn’t finish until 2024. Along the way, the project’s cost more than doubled from $14 billion to $30 billion.

On top of that, the whole of France is only about the size of Texas, so it would take more time and money for the U.S. to build out a nuclear grid like France has.

Or would it?

Modern technology may have solved the time issue, which will ultimately bring costs down as well. The solution I’m talking about is small modular reactors, or SMRs.

These are pint-sized nuclear reactors that take up a fraction of the space a traditional nuclear power plant would. And they essentially roll off an assembly line. The U.S. military has utilized smaller reactors in their fleet of nuclear submarines and aircraft carriers for decades.

However, the new generation of commercial SMRs takes this technology to a new level.

These SMRs use next-generation nuclear technology that is faster, more efficient, cheaper, and, most interestingly, mobile.

Now a new crop of companies are developing SMRs for use on land as traditional power plants. Plop one of these down next to some data centers running AI software and their energy issues are solved by the power of the atom.

America’s nuclear champion is Lynchburg, Virginia-based BWX Technologies Inc. (NYSE: BWXT).

Your Friendly Neighborhood Reactor

Those sub- and ship-based reactors I mentioned earlier? BWXT made most of them. It has delivered more than 400 reactors to the Navy for its vessels, has built 325 steam generators for nuclear power plants, and has been at the bleeding edge of nuclear science for more than 60 years.

It’s the only large, commercial nuclear equipment manufacturing facility in North America. It builds reactor components like heat exchangers, pressurizers, spent fuel containers, and more. Most important for our purposes, it built the first advanced nuclear microreactor in the United States under a Department of Defense contract.

Now on to how BWXT will help solve our energy problems…

America’s 54 nuclear power plants generate just shy of 20% of our electricity. If you live east of the Mississippi, there’s a good chance you use nuclear power daily. But those plants are enormous and usually built on rivers or lakes to give them the fresh water they need to operate.

The Vogtle plant I mentioned earlier takes up 3,000 acres. BWXT’s SMR, dubbed the BWXT Advanced Nuclear Reactor, or BANR, can fit on the back of a flatbed truck. And that’s precisely the idea. The reactors roll off BWXT’s assembly line, get loaded onto the back of a truck, and then get shipped out to the miniature nuclear power plant they will generate power in.

This is crucial for the data center buildout for AI.

If a Big Tech company like Amazon wants to build a new data center to power AI technology, but it needs access to power… it’ll be able to order an SMR from BWX.

And this will happen all over the country.

One BANR is rated to deliver 50 megawatts of power. It doesn’t need a traditional water source like current reactors do, either. It’s a high-temperature, gas-cooled reactor (HTGR), so it uses helium as coolant, as opposed to water. It also only needs refueling every five years as opposed to the industry standard of two.

Because it’s truck- or train-portable, the BANR doesn’t need any of the traditional infrastructure of a traditional reactor. That means it can essentially be deployed anywhere…

Take the hurricanes that tore through North Carolina, Georgia, and Tennessee last year. It took weeks for state governments and FEMA to get the power back on, and people died as a result. But BWXT could have solved that problem. Truck a BANR on in, set it up, and it’s producing 50 megawatts of power as soon as the reaction starts.

The military applications are obvious, and so is the disaster relief uses for this technology. But Big Tech will be using this the most. If Elon Musk is correct and we begin facing power shortages this year, you can bet Amazon, Google, Meta, etc., won’t stand for it. They will get BANRs shipped in and set up to run their data centers.

Some will likely want more permanent solutions… like GE-Hitachi’s BWRX-300 SMR, which it aims to launch globally in 2029.

The BWRX-300 is essentially a larger, more permanent take on BWXT’s BANR. It’s a very small modular power plant capable of generating 300 megawatts of power… And BWXT will be engineering and supplying the reactor pressure vessel (RPV) for the BWRX-300. The RPV contains the reactor core and its internals – it’s also the largest and among the most critical parts of a nuclear plant.

So, whether a business or community wants small and temporary or large and permanent, BWXT will profit from its extensive expertise in nuclear engineering. Speaking of profit, BWXT isn’t some flash-in-the-pan startup with a wild idea. It was founded in 1867 as Babcock & Wilcox Company. Blue chips don’t get bluer than that.

But that’s not all. BWXT is also a major player in the medical industry. It entered the nuclear medicine industry in 2018 with the acquisition of Nordion’s medical isotope business.

In January 2025, the company announced the agreement to acquire Kinectrics, Inc. for approximately $525 million. Kinectrics is not only a leader in lifecycle management services in the nuclear power markets, but they also supply isotopes for the radiopharmaceutical industry. This acquisition will expand BWXT’s portfolio of products and services available for current and new customers. BWXT finalized the deal in May 2025, which doubled the workforce of BWXT’s Commercial Operations group. 

The growth in the company’s commercial business revenue was in large part driven by its burgeoning medical sector. And, on the subject of finances, BWX is an incredible stock. It has the balance sheet of the 158-year-old blue chip it is, combined with immense growth potential thanks to America’s pending nuclear renaissance…

The Nuclear Option

Let’s start with revenue. BWXT has been on a tear for years. Over the past five years, annual revenue has increased at a compound annual growth rate (CAGR) of 6.6%. That trend has accelerated over the last three years, reaching a CAGR of 9.4%.

Total revenue for 2024 was up 8.3% over 2023’s, totaling $2.7 billion. Net income for 2024 topped $281.9 million, up almost 15% over 2023’s net income. EPS for 2024 grew 14.4% to $3.08.

For Q1 2025, BWXT brought in $746.27 million in revenue, up 2.96% over Q1 2024. Operating income for the quarter surged 11.33% year over year, net income climbed 10.21%, and EPS grew 1.17%.

To put icing on the cake, BWXT pays a dividend that yields 0.8% at current prices, and it has grown that dividend 13.65% over the last three years.

Business is booming, to say the very least, and BWX is expanding its Cambridge plant in Ontario, Canada, to accommodate the demand for nuclear plant equipment and SMRs. The CA$50 million expansion will increase the factory’s footprint by 280,000 square feet. It will then be followed up with CA$30 million in new equipment and tooling to manufacture SMRs faster than ever before to meet new demand. The project is expected to be completed by mid-2026.

In April 2025, BWXT announced the acquisition of approximately 97 acres of land in the Horizon Center Industrial Park in Oak Ridge, Tennessee. This deal is an additional step in BWXT’s long-term commitment to restoring the nation’s domestic uranium supply and its intent to support future defense missions for the U.S. Department of Energy’s National Nuclear Security Administration (NNSA) and other projects. 

With a balance sheet and an economic tailwind like that, BWXT is the second step to profiting from America’s nuclear renaissance. It’s building the reactors that America’s top uranium miners’ fuel will go into. You can read all about that here.

BWXT has the stability and revenue of a blue chip but the growth potential of a much smaller stock. As nuclear power becomes more mainstream in the coming years, I think that will act as a tailwind and push it to new heights.

The stars are aligning for the company building a nuclear reactor you could put in your backyard.

Futurists of the 1950s imagined nuclear-powered cars. It seemed far-fetched then, but thanks to BWXT, the atom-powered future they imagined might be closer than we think. And you can buy shares in it today…

Action to Take: Buy BWX Technologies Inc. (NYSE: BWXT) at market. Set a 25% trailing stop to protect your principal and your profits.