We recently published a list of the 13 Best Energy Stocks to Buy Right Now. In this article, we are going to take a look at where Constellation Energy Corporation (NASDAQ:CEG) stands against other best energy stocks.
The worldwide energy industry has recently been rattled by a combination of factors, including the trade war sparked by President Trump’s tariffs, the prospects of a global economic slowdown, and the sharp slump in crude oil prices. As a result, at the time of writing this piece, the overall energy sector has fallen by 4.64% since the beginning of 2025, compared to declines of almost 3.6% by the wider market.
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The steep downturn in global crude prices has particularly hit hard, and there appear to be no signs of a reversal as of yet, since the supply is projected to increase while demand forecasts keep falling. The West Texas Intermediate (WTI) oil price fell to just over $57 a barrel earlier this week, a level it last hit during the peak of the COVID-19 pandemic in 2021. However, it has slightly recovered since then and is currently hovering just around the $61 mark, buoyed by hopes of a breakthrough in looming trade talks between the US and China. Still, the low prices and higher costs due to tariffs on steel and aluminum have pushed many American oil producers to put the brakes on drilling new wells.
However, the same cannot be said about natural gas and its liquified state, LNG, which has especially fared well under the Trump administration. On his very first day in office, the President ordered the resumption of LNG export approvals and has started rolling back environmental regulations that slowed projects. The United States is already the largest LNG exporter in the world, with a record 11.9 billion cubic feet per day of outflows in 2024. These numbers are now expected to receive a significant boost, as the US Energy Information Administration has forecasted the country’s LNG exports to 15.2 bcfd this year. Europe remains the top destination for American LNG, accounting for over 75% of total orders this year. The continent has had to rely significantly more on imported LNG and less on gas delivered via pipelines from Russia since the Putin government’s invasion of Ukraine in 2022.
The ongoing AI boom is also expected to be a significant growth factor for the natural gas industry, which has emerged as the leading contender to power its data centers. These energy-intensive facilities could consume as much as 9% of all energy generated in the US by 2030, and this energy needs to come from a relatively clean, flexible, and reliable source that is abundantly available in the form of natural gas. According to data from S&P Global Commodity Insights, if even a quarter of the projected data center load is supplied by gas-fired generation, this would translate to a 2% increase in total US gas demand in 2040.
The price of natural gas has more than doubled since March 2024, offering a significant lifeline for America’s oil and gas sector in the last quarter, especially with the plunging crude prices denting their profits.
A close up of a wind turbine producing electricity as the sun sets.
Methodology:
To collect data for this article, we scanned Insider Monkey’s database of hedge funds’ stock holdings and picked the top 13 companies operating in the energy sector with the highest number of hedge fund investors in Q4 of 2024. The following are the Best Energy Stocks According to Hedge Funds.
At Insider Monkey, we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Constellation Energy Corporation (NASDAQ:CEG)
No. of Hedge Fund Holders: 85
Constellation Energy Corporation (NASDAQ:CEG) is the largest producer of carbon-free energy in the US with approximately 34.2 GW of generating capacity, enough to power 16 million homes and businesses.
Constellation Energy Corporation (NASDAQ:CEG) missed profit estimates in Q1 2025 as its adjusted EPS of $2.14 fell below expectations by $0.08, primarily due to the rising costs it incurred to build and operate its electricity infrastructure. However, the company’s revenue surged by over 10% YoY to $6.79 billion and beat forecasts by a hefty $1.35 billion. CEG also recently declared a quarterly dividend of $0.3878 per share and reiterated that it still has about $1 billion left in its buyback authorization program.
Constellation Energy Corporation (NASDAQ:CEG) also revealed that its $26.6 billion acquisition of Calpine Corp. is on track to be completed by the end of the year, which will create the ‘nation’s largest clean energy provider’, boasting nearly 60 GW of capacity from zero- and low-emission sources. Calpine will add at least $2 in EPS and $2 billion of free cash flow before growth, starting next year.
Constellation Energy Corporation (NASDAQ:CEG) expects a 1-2% impact of President Trump’s tariffs on its capex plan for 2025 and 2026. The company also stated that it is moving ahead with power deals with data centers, including with the reopening of the former Three Mile Island nuclear reactor.
Overall, CEG ranks 7th on our list of the best energy stocks to buy right now. While we acknowledge the potential of CEG as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than CEG but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.