A Promising Portfolio Power-Up

I know nuclear's not the sexiest energy solution around. Some even malign it as 50s technology. But Shaw Group (NYSE: SGR  ) doesn't mind. It cares about the cash.

This company, along with perennial nuclear option Cameco (NYSE: CCJ  ) , is simply one of the best-positioned to profit from the next wave of nuclear power. During the fiscal third quarter, Shaw won EPC (engineering, procurement, and construction) contracts from SCANA (NYSE: SCG  ) and Southern Company (NYSE: SO  ) , for two reactors each. The firm, noting that nuclear "continues to look better and better every quarter," expects to book a few more reactors this summer, and anywhere from two to eight more in fiscal 2009.

As mentioned in my last look at the company, Shaw doesn't count the bulk of this nuclear project work in its backlog, which recently increased 15% to a fresh record of $16.4 billion. If it did, order backlog would be around $38 billion. That's a staggering sum for a $5 billion firm.

Though it's usually a highlight, nuclear wasn't the only thing for Shaw to brag about this quarter. Record results abounded, with strong bookings and margins all around.

The firm's fossil and nuclear segment benefited from passage of a key environmental permit, allowing the construction of a Dominion (NYSE: D  ) coal/biomass power plant. Shaw's maintenance segment picked up a nice three-year extension (and expansion) with specialty chemical maker Albemarle (NYSE: ALB  ) . The environmental & infrastructure division really cleaned up, with $2.7 billion in new contract awards, including work on a major government program that's turning plutonium into nuclear fuel.

As noted by a Foolish colleague back in December, Shaw has come a long way since its early pipe-bending days. But it hasn't forgotten its roots: Shaw just boosted capacity by 25%, and it is the largest pipe fabricator in North America. That said, Shaw's real growth potential lies elsewhere, so worldwide nuclear plans should be your key focus if you're a Shaw shareholder.

Shaw Group is rated a strong four stars in Motley Fool CAPS. Think it'll fuel Foolish portfolios in the future? You can give 'er a thumbs-up right here.