The global nuclear energy renaissance we’ve been seeing in the past few years has been driven by a few different factors, but one of the biggest is the energy needs of artificial intelligence (AI).
There was already a general push toward clean energy, but the rapid data center build-out to run AI programs has created an even larger demand for power.
One of the most promising solutions to the data center problem is the small modular reactor (SMR).
These pint-sized power plants work just like their larger counterparts but at a fraction of the size. The idea is that an SMR could be plopped in the middle of a cluster of data centers to power them without relying on the local grid.
Many companies are working on SMR technology, but lots of them are cash-strapped start-ups solely focused on SMRs. However, two of them, BWX Technologies (BWXT 0.02%) and Rolls-Royce (RYCEY +1.24%), are developing SMRs but with steady revenue streams from their existing business operations.
By my math, they’re two of the best nuclear energy plays right now, especially when it comes to SMR technology.
Image source: Getty Images.
One if by sea
Up first, BWX Technologies has been a leader in naval nuclear propulsion since the very beginning.
It designed and built components for the USS Nautilus, the world’s first nuclear-powered submarine, back in the 1950s. Since then, the company has built over 400 nuclear reactors for the U.S. Navy.
Since then, BWX has been on the bleeding edge of nuclear technology and it has a wealth of experience making nuclear reactors work on the smaller-scale demanded by the confines of a ship or submarine.
The company’s BWXT Advanced Nuclear Reactor (BANR) design is a modular factory-built nuclear power plant capable of generating 75 megawatts of power wherever it’s deployed. It’s being designed with data centers in mind and uses BWXT’s TRISO-coated fuel, which is more resistant to irradiation, corrosion, and high temperatures than conventional nuclear fuel.
And BWX is pretty far from a start-up. Its main business of nuclear engineering for the Navy means it has plenty of cash to put into developing the BANR. At present, the company runs a net profit margin of 10.31%. The whole of 2025 saw its revenues climb 18% over 2024 to $3.19 billion and its earnings per share (EPS) surge 20%.
So, if you’re looking for a more financially stable SMR company, consider BWX Technologies before any of the start-ups.
Today’s Change
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Current Price
$216.34
Key Data Points
Market Cap
$20B
Day’s Range
$212.96 – $218.22
52wk Range
$102.42 – $241.82
Volume
20K
Avg Vol
990K
Gross Margin
22.87%
Dividend Yield
0.47%
Two if by air
Second is Rolls-Royce, which is similar to BWX but focused on aircraft engines as opposed to naval propulsion.
You might see the name Rolls-Royce and think of the ultra-luxury cars, but the automotive segment of Rolls-Royce was sold to BMW in the 1990s. The core of the business has always been aircraft engines going back to World War I.
Today, Rolls-Royce produces jet engines for both civilian and military applications. But it does also develop nuclear propulsion systems for the Royal Navy’s submarines. That expertise is being poured into the company’s SMR prototype, which is larger than BWX’s. It’s still assembled in parts in a factory but is capable of producing 470 megawatts.
That perhaps makes it a better solution for powering neighborhoods or small cities as the reactor can power up to 1 million homes. But either way, the reactor’s footprint is much smaller than a traditional nuclear power plant.
The reactor has been selected in the Great British Nuclear SMR competition and is slated to be the U.K.’s next-generation nuclear power solution. Czech power company ČEZ has also signed an agreement with Rolls-Royce to adopt its SMR in Czechia.
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Market Cap
$137B
Day’s Range
$16.06 – $16.48
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$10.22 – $18.98
Volume
7M
Avg Vol
3.8M
Gross Margin
27.89%
Dividend Yield
0.41%
At present, there are no SMRs in operation anywhere in the world. That’s a problem for the start-ups solely focused on the technology. But for companies like BWX and Rolls-Royce, they have other revenue streams keeping them afloat and growing.
In Rolls-Royce’s case, it saw its revenue grow 12.15% in 2025 over 2024 to $21.21 billion, and its EPS more than double from $0.30 to $0.69 over the same period. The company also runs a net profit margin of 27.52% at present.
Rolls-Royce can be looked at as BWX’s larger and older brother across the pond given the similarities between their businesses. Either or both of them together makes a great way to play SMR technology with much lower risk than the smaller companies engaged in developing it.
