Centrus Energy (LEU -3.25%) stock jumped 8.8% through 3:15 p.m. ET Wednesday on (potentially) terrific news for the nuclear power industry.
Earlier this year, investors in nuclear stocks -- and artificial intelligence (AI) stocks -- were all aflutter after reports said Microsoft is slow-rolling setting up data centers for AI services. And if Microsoft is foreshadowing AI doom, this might mean we won't need to build a lot of nuclear power plants to keep AI server farms humming.
Yesterday, though, Constellation Energy announced a 20-year deal to supply nuclear power to Meta Platforms server farms. Today, it was Amazon's turn to give nuclear stocks a boost, announcing a $10 billion investment in new data centers in North Carolina.
Image source: Getty Images.
What's Amazon up to in North Carolina?
Amazon is building the data centers to support its own AI infrastructure -- part of a plan that could see Amazon spend $100 billion this year on capital improvements in general, AI infrastructure in particular.
And what does this mean for investors in companies like Centrus, which enriches uranium for use in nuclear power plants? Well, we now have two gigantic AI firms -- Meta and Amazon -- announcing over two straight days back-to-back gigantic deals to grow their AI businesses.
Whether or not Microsoft is scaling back its own AI bets (and there is still some debate on that point), if Meta and Amazon are still going full speed ahead, that means AI is still growing. And if AI is growing, then the need for nuclear power plants to fuel that growth -- and for enriched uranium to fuel the power plants -- will grow as well.
That's bullish for Centrus stock. It's why Centrus stock is going up today.
