A Big Upgrade for EnergySolutions

After spending much of the past year at a four-star rank, EnergySolutions (NYSE: ES  ) has impressed enough top-performing members of our 165,000-strong Motley Fool CAPS community to touch the five-star level. A total of 401 members have given their opinion on the nuclear energy services company, with many of them offering analysis and commentary explaining the recent optimism.

With EnergySolutions' strong track record in the nuclear services market and global nuclear energy demand on the rise, CAPS members like the potential for the company to profit from the demand for its services. The company generated higher first-quarter revenue, helped in part by stimulus funds and strength in its federal services segment. And some customers in its commercial segment, which include major nuclear power plant owners Exelon (NYSE: EXC  ) and Duke Energy (NYSE: DUK  ) , had improving power demand and rising first-quarter earnings themselves. The company handles a large portion of the nuclear waste from power plants in the U.S., and investors like the security of its long-term contracts plus the growth developments in the industry.

After several decades of no new nuclear power plants in the U.S., Southern (NYSE: SO  ) recently broke ground on Plant Vogtle. And the government looks ready to provide billions more in financial assistance for nuclear power projects. French company Areva was awarded a $2 billion loan guarantee for an Idaho project, and the government plans to fund guarantees for NRG Energy's (NYSE: NRG  ) and Constellation Energy's projects instead of just one or the other. Companies like Shaw Group (NYSE: SHAW  ) are investing heavily for the next nuclear building cycle, and McDermott (NYSE: MDR  ) plans to better position its nuclear services division with a spinoff of the segment.    

EnergySolutions gets most of its international revenue from the U.K., but many CAPS members are bullish on growth in other European and Asian markets, where the company is expanding its presence. With Asia stepping up its nuclear ambitions and the U.S. making progress toward a nuclear future, investors like where EnergySolutions is headed. 

Do you think EnergySolutions deserves its improved status? Add your thoughts in the comments box below on this page, or head over to CAPS to rate the company and check out all the information and opinions the community offers, absolutely free.

The Motley Fool Inside Value team looks for stocks that are selling at prices well below their intrinsic value. To see the full list of cheap companies the service is recommending today, take a free 30-day trial.

Fool contributor Dave Mock recently upgraded his tiddlywinks aptitude from dismal to passable. He doesn't own shares of companies mentioned here. Exelon is an Inside Value choice. Duke Energy and Southern are Income Investor selections. Motley Fool Options has recommended a write puts position on Exelon. The Fool owns shares of EnergySolutions. The Fool's disclosure policy drinks responsibly and never rambles on while intoxicated.


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