One stock to replace Nvidia (From InvestorPlace)
Key Points
AI data center power demands are expected to grow exponentially through the end of the decade, creating a void that nuclear energy companies are looking to satisfy.
NUKZ offers broad exposure with a reasonable expense ratio of 0.85%.
The fund is up 70.74% since its YTD low, and 93.21% since its one-year low.
A nuclear energy renaissance is underway. So far this year, it’s provided outsized gains for investors who jumped on the bandwagon early.
Take, for example, pre-revenue Lightbridge (NASDAQ: LTBR), up nearly 202% since its year-to-date (YTD) low on January 14. And another, NuScale Power (NYSE: SMR), is up more than 177% since its YTD low on April 4.
But is this trend likely to continue for those who missed the boat—or in this case, a nuclear-powered submarine of profits? And if so, how can you get broad exposure without guessing which companies will come out on top?
The answer to the former is highly likely, and the answer to the latter is the Range Nuclear Renaissance Index ETF (NYSEARCA: NUKZ).
In my 54 years as an investor, I’ve seen my share of gold bull markets.
But nothing comes close to the rally right now.
Over the past few weeks alone, the yellow metal surged as high as $3,500 — the highest level on record.
So far this bull run playing out exactly as me and my analysts have predicted.
Data Center Power Demand Is Driving the Nuclear Revival
On May 28, Apollo Chief Economist Torsten Sløk noted that, despite GDP contracting in Q1 this year, data center construction added 1% to GDP growth. Then, in early August, Fortune reported that data centers have surpassed consumer spending as the most significant contributor to U.S. GDP.
Why? The rapid and seemingly insatiable demand for artificial intelligence (AI) is driving a looming energy supply gap. And the electricity demands of AI data centers are also driving a looming energy supply gap. As a result, many of the operators of those data centers are pivoting to nuclear power, specifically small modular reactor (SMR) deployment.
According to Grand View Research, the global AI data center market’s estimated value was $13.62 billion in 2024. From 2025 to 2030, it’s expected to undergo a compound annual growth rate of 28.3%, most of which is attributable to adopting AI technologies. While fossil fuels currently meet those energy demands of the prolifers, hydrocarbon limitations faced by traditional utilities won’t be able to keep pace with AI data center growth.
Meanwhile, the International Energy Agency has stated that the AI data center market has the potential to transform the energy sector single-handedly:
Global Energy Demand: The base case for global AI data center energy consumption in 2030 is around 1,000 Terawatt-hours (TWh). In 2020, that figure stood at around 250 TWh, meaning by the decade’s end, that requirement could grow by 300%.
Domestic Energy Demand: The U.S. Department of Energy (DOE) says that domestic energy usage from AI data centers is expected to triple by 2028. In 2023, that demand equated to 4.4% of total U.S. electricity. By 2028, the DOE expects that figure to be 6.7–12%.
Net Zero: SMRs will play a critical role in supporting net-zero targets. Amazon (NASDAQ: AMZN), for example, announced that SMRs will be central to the company’s goal of achieving net zero by 2040.
As the Magnificent Seven companies position themselves for a nuclear makeover, companies will be competing to meet that demand. Amazon is investing $334 million into an SMR feasibility study, while Alphabet (NASDAQ: GOOG) has announced it will purchase electricity from a series of SMRs being produced by Kairos Power.
So the AI-borne nuclear rally appears to have legs. For investors who weren’t on board at its inception, remember: “The best time to invest was yesterday. The second-best time is today.”
The Go-To ETF for Nuclear Exposure
The Range Nuclear Renaissance Index ETF is the all-in-one solution for investors looking to tap into the nuclear industry’s luminous future.
While NUKZ's expense ratio of 0.85% is considered high for a passively managed fund, its portfolio includes some of the biggest and brightest names in the space.
Its largest holding by weight is Cameco (NYSE: CCJ), at 9.86%. The Canada-based company is the world’s largest uranium miner, with a $33.44 billion market cap. NUKZ’s second-largest portfolio position is Constellation Energy (NASDAQ: CEG), at 8.385%. In June, the utility company inked a 20-year deal with Meta Platforms (NASDAQ: META), providing the tech giant with 1,121 megawatts of emissions-free nuclear energy.
Since hitting its YTD low on April 8, NUKZ is up nearly 71%, and since its one-year low on Sept. 6, 2024, the fund is up more than 93%. While those gains may hold back prospective investors who are fearful of buying at the top, this ETF is leveraged to a high-growth industry that will be keeping pace with the proliferation of AI.
But for those looking for a better entry, the ETF’s Relative Strength Index (RSI) on the one-year chart is currently reading 49.55:
While that figure is neutral, it could coincide with a pullback to support around $55 if the downtrend continues. If that level fails, the ETF could test $50 before its RSI enters oversold territory and shares see a reversal.
Written by Jordan Chussler
Further Reading:
Your Bank Account Is No Longer Safe (From Priority Gold)
Utah’s New Oil Find (From Stansberry Research)
