Constellation Energy Wins Walmart Nuclear Deal as AI Power Demand Surges

Constellation Energy has emerged as a key beneficiary of the AI industry's urgent need for reliable power, but the broader story is about surging electricity demand across the economy. The company's two headline deals—with Meta and Walmart—illustrate how AI is reshaping capital allocation, yet the Walmart contract demonstrates that clean energy transitions extend well beyond data centers. By operating outside regulated utility frameworks, Constellation can lock in long-term contracts at market rates, giving it growth potential that traditional utilities lack.

The company's recent valuation correction is noteworthy: when nuclear power became a Wall Street darling during peak AI enthusiasm, Constellation's price-to-earnings ratio soared to nearly 50x, an unrealistic level. That bubble has deflated, and the stock now trades at 21x—only slightly above the 20x average for utility stocks. This recalibration reflects a more sober assessment of the business's fundamentals while preserving its structural advantages. The purchase of Calpine, which expanded Constellation's natural gas operations, signals that the company is not betting everything on nuclear or AI demand alone, but rather positioning itself to serve broad electricity demand growth across the 2025–2045 period.