Ottawa\u2019s ambitious plan to expand Canada\u2019s nuclear footprint will take years to realize. Stocks associated with the plan could see a much faster payoff.<\/p>\n
One name to watch: AtkinsR\u00e9alis Group Inc. ATRL-T<\/a><\/p>\n The share price has begun to rise since the federal government unveiled its nuclear energy strategy<\/a> on Monday and singled out the Montreal-based engineering company\u2019s Candu reactors as a key element.<\/p>\n The bullish case for the stock rests on Canada\u2019s nuclear plan unfolding through the 2030s and beyond, as the government upgrades the country\u2019s electricity grid with reliable renewable energy. <\/p>\n Equally important to this case: international buyers will come calling as the profile of the Candu brand rises and production of the reactors grows more efficient through economies of scale.<\/p>\n Is the case strong enough to reinvigorate investor interest in the nuclear sector?<\/p>\n The nuclear theme has hit a bumpy patch over much of the past year, after enthusiasm for the sector faltered under the weight of high investor expectations and lofty stock valuations.<\/p>\n Consider the trajectory of Cameco Corp. CCO-T<\/a> The share price of the Saskatoon-based uranium producer surged nearly 250 per cent from April, 2025, through January of this year.<\/p>\n Global interest in nuclear energy, which includes rare political alignment<\/a> over the need to expand the number of reactors in the United States, raised Cameco\u2019s long-term appeal. But the share price has slumped 18 per cent from its January peak.<\/p>\n In a more extreme case, the share price of Oklo Inc. OKLO-N<\/a>, the U.S. reactor supplier, soared over 750 per cent from April to October last year. It has stumbled nearly 70 per cent from these nosebleed heights over the past eight months.<\/p>\n AtkinsR\u00e9alis has been caught in milder slump. From September last year through mid-June, before the Canadian government released its nuclear strategy, the share price was down by about 24 per cent \u2013 interrupting a 360-per-cent rally over the previous three years. <\/p>\n In addition to waning investor interest in the nuclear theme, the stock may have been a victim of uncertainty surrounding the potential impact of artificial intelligence, as new AI capabilities threaten to undermine engineering consultancy fees<\/a>.<\/p>\n Perhaps this dip is exactly what investors were waiting for.<\/p>\n The share price has gained about 11 per cent over the past week, as of Thursday, suggesting that some investors may be sniffing a bargain now that sentiment has cooled. Some valuation metrics \u2013 including the price-to-earnings ratio \u2013 are well below their highs last year.<\/p>\n \u201cWe continue to see significant value in shares of AtkinsR\u00e9alis with nuclear-led growth, an active mergers and acquisitions pipeline and opportunities for margin expansion across engineering services,\u201d Chris Murray, an analyst at ATB Capital Markets, said in a note this week.<\/p>\n The Canadian government owns the intellectual property associated with Candu reactors, which operate in places such as Ontario\u2019s Bruce Power. <\/p>\n AtkinsR\u00e9alis is the original equipment manufacturer and the exclusive licence holder, giving the company significant upside should the reactors edge out competitors. These rival reactor makers include U.S.-headquartered Westinghouse Electric as well as GE Vernova Inc., whose share price has risen about 700 per cent over the past two years.<\/p>\n Despite this competition, the Candu bet is compelling. <\/p>\n Benoit Poirier, an analyst at Desjardins Securities, estimated that AtkinsR\u00e9alis\u2019s nuclear operations alone are potentially worth about $62 a share \u2013 or $41 a share for the pipeline of new construction opportunities and $21 a share for refurbishments.<\/p>\n Not bad given that the shares are currently trading at about $90 in Toronto.<\/p>\n Mr. Poirier\u2019s estimates are based on the company winning contracts for 50 new reactors by 2050. That\u2019s a 5-per-cent share of the 1,000 new reactors that could be built globally during what the analyst calls a \u201cnuclear supercycle.\u201d<\/p>\n Sure, it\u2019s a long-term bet with a lot of moving parts. <\/p>\n But it rests on solid ground: The International Atomic Energy Agency expects that global nuclear operational capacity will more than double by 2050<\/a>, compared to 2024, to 992 gigawatts. <\/p>\n The agency has raised its estimates for global nuclear expansion five times since 2021 by a combined 25 per cent, reinforcing the case for nuclear energy with each revision.<\/p>\n