Constellation Energy price target raised to $263 from $208 at BofA

BofA analyst Ross Fowler raised the firm’s price target on Constellation Energy (CEG) to $263 from $208 and keeps a Neutral rating on the shares after the company announced that will restart Unit 1 of the Three Mile Island nuclear facility and provided the resulting output to a Microsoft (MSFT) owned data center. Constellation did not disclose the financial details of the supply contract, but did highlight that base earnings growth over the ’24-’30 period will increase from 10% to 13%, that the project exceeds its double-digit return threshold, and that it qualifies for the 45Y new nuclear tax credit, notes the firm, which says the above-market price contract at TMI is “a clearly positive development.” However, the firm sees no obvious similar opportunities across the portfolio, so this type of project is likely to be one-time in nature, the analyst added.