Morgan Stanley recently issued a research report to clients, designating the Canadian energy company TC Energy as a "low-risk nuclear power investment" and assigning it an "Overweight" rating.
Core Asset: One of the World's Largest Nuclear Plants Morgan Stanley analyst Robert Kad noted in the report that TC Energy holds approximately a 48% stake in Bruce Power. Bruce Power is one of the world's largest operational nuclear power plants and is Canada's only privately-owned nuclear power generation enterprise. The analyst believes the company offers investors the "most attractive risk-adjusted" opportunity for nuclear power growth investment.
Growth Drivers: Two Key Projects Morgan Stanley asserts that TC Energy is positioned to benefit from the nuclear power resurgence through two key initiatives: The first is the "Major Component Replacement" program, designed to refurbish nuclear reactors and extend their operational life by several decades. The company completed the first phase of this program in September 2023. The second is the "Bruce C" project, which plans to add up to 4,800 megawatts of generating capacity at the Bruce Power site in Ontario.
Industry Context: Strong Nuclear Power Revival Momentum Morgan Stanley's favorable stance comes amid increasing interest in nuclear power. According to the World Nuclear Association, global nuclear reactor electricity generation reached 2,667 terawatt-hours in 2024, surpassing the previous record of 2,660 terawatt-hours set in 2006. The analyst pointed out that while the market tends to favor more speculative, high-risk/high-reward nuclear power concepts, TC Energy, as a "highest-quality, lowest-risk" option, is often overlooked by investors.
Market Divergence: Mixed Analyst Views However, market opinions on the stock are divided. Data from LSEG shows that currently, three analysts rate it a "Buy," two rate it a "Hold," and one rates it "Underperform." Year-to-date, TC Energy's stock price has accumulated a gain of approximately 10%.
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