1 Nuclear Stock That Could Power Your Retirement Income for Decades

After the Fukushima disaster in 2011, many nuclear energy companies struggled for more than a decade as cautious countries paused their nuclear projects. But over the past few years, the nuclear market has warmed again as power-hungry cloud infrastructure, artificial intelligence (AI), and data center markets have driven more countries to restart those projects. The development of smaller, safer, and more power-efficient reactors is also fueling that boom.

From 2024 to 2050, the International Atomic Energy Agency (IAEA) expects the world's nuclear capacity to expand by up to 2.6 times. To capitalize on that expansion, many growth-oriented investors are flocking toward nuclear "pure plays" -- such as the uranium miner Cameco (NYSE: CCJ) or small modular reactor (SMR) maker NuScale.

Image source: Getty Images.

However, those stocks are volatile and don't pay any dividends. If you're looking for a more conservative income play with plenty of exposure to the expanding nuclear market, you should take a closer look at Brookfield Asset Management (NYSE: BAM).

What does Brookfield Asset Management do?

Brookfield Asset Management is one of the world's largest alternative asset management firms. Instead of investing in traditional assets like stocks, bonds, and Treasuries, it provides exposure to "alternative" investments like real estate, infrastructure, private equity, and credit markets. Most of its profits come from its management fees for those portfolios.

In 2023, Brookfield Asset Management teamed up with Cameco to purchase Westinghouse, one of the world's top nuclear energy and technology companies. Brookfield now owns 51% of Westinghouse, while Cameco controls the remaining 49%.

Brookfield Asset Management measures its growth with three key performance metrics: its fee-bearing capital (FBC), its total managed capital from all its clients; its fee-related earnings (FRE), or its total earnings from management and advisory fees; and its distributable earnings (DE), or its available cash flow for covering its dividends and interest payments. All three figures have steadily risen over the past four years, even as inflation, higher interest rates, geopolitical conflicts, and other macro headwinds rattled the global economy.

Data source: Brookfield Asset Management. YOY = Year-over-year.

Brookfield continued to grow as many institutional investors shifted their assets from conventional to alternative investments to hedge their portfolios against those challenges. Many of its funds also lock in their investors for more than a decade.

Why is Brookfield a nuclear income stock?

Those strengths already make Brookfield Asset Management a stable long-term investment. It also pays a forward yield of 3.7% and has raised its payout each year after it was spun off from Brookfield Corporation in 2022.

But from 2025 to 2030, Brookfield plans to double the size of its business with $1.2 trillion in FBC, $5.8 billion in FRE, and $5.9 billion in DE by the final year. A major catalyst will be its controlling stake in Westinghouse, which entered a strategic partnership with the U.S. government last October to construct at least $80 billion in new reactors to "reinvigorate the nuclear power industrial base" and support the expansion of the AI market.

Therefore, the nuclear market's expansion should directly boost Brookfield's DE over the next few decades, giving it ample room for future dividend hikes. So if you're looking for a simple way to profit from the resurgent nuclear market that generates stable income, Brookfield Asset Management checks all the right boxes.

Leo Sun has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Brookfield Asset Management, Brookfield Corporation, and Cameco. The Motley Fool recommends NuScale Power. The Motley Fool has a disclosure policy.