Got $1,000? This Nuclear Fuel Stock Is the Pick-and-Shovel Play I'd Buy Right Now.

Nuclear energy stocks have been in the doldrums this year. The Global X Uranium ETF (NYSEMKT: URA) is down around 15% so far this year, reflecting the sector's overall malaise.

The reason for the decline is that the sector became a little overheated due to enthusiasm for nuclear energy, with technology companies signing deals to secure nuclear electricity for artificial intelligence (AI) data centers. While this points to long-term growth, many newer nuclear energy companies face a long road to profitability.

Instead of focusing on nuclear companies that may eventually turn things around, it makes more sense to look at pick-and-shovel nuclear stocks that are already profitable and benefiting from the growth of nuclear energy. One of those stocks is Centrus Energy (NYSE: LEU), the lone publicly traded proven U.S. uranium enricher. While shares of Centrus have plummeted more than 52% so far this year, the company remains a solid buy, and the stock's valuation has become more reasonable, trading at about 33 times forward earnings.

Here are three reasons to consider Centrus Energy.

Image source: Getty Images.

It has a first-mover advantage

Centrus operates the only U.S. Nuclear Regulatory Commission (NRC)-licensed facility capable of producing high-assay low-enriched uranium (HALEU), the specialized fuel enriched between 5% and 20% U-235 required for almost all next-generation advanced small modular reactors (SMRs) and microreactors. The company finalized its $900 million order to produce HALEU for the U.S. Department of Energy (DOE) in July.

With more companies racing to advance nuclear technologies, Centrus already has multi-year supply agreements with emerging reactor developers, such as X-energy, Radiant Industries, and Antares Nuclear. These partnerships, often backed by customer prepayments, make Centrus a central pick-and-shovel provider for the future nuclear tech boom.

It is showing dependable revenue growth

In the second quarter, Centrus reported revenue of $176.1 million, up 13.9%, year over year. It is estimating full-year revenue between $450 million and $500 million, compared to $448.7 million in 2025.

Centrus has a $4.5 billion backlog, with work scheduled out to 2040. This shows that customers are locking in long-term orders for years to come. Of that total, $3.7 billion comes strictly from its primary fuel business of selling standard reactor fuel and uranium to power utilities.

These are mostly fixed, multi-year contracts for guaranteed future deliveries. In addition to its fixed orders, it has agreed to $3 billion in potential future sales of low-enriched uranium (LEU) and HALEU.

Adjusted net income was $38.7 million, up 12% over the same period a year ago, but adjusted earnings per share (EPS) were $1.95, flat compared to the second quarter of 2025.

It has a huge moat

The United States hasn't had its own active facility to enrich uranium for national security and defense needs since the Paducah, Kentucky, plant closed in 2013. The DOE is relying on Cold War-era stockpiles. Because this supply is finite and shrinking, the U.S. will soon need a new domestic source of enriched uranium to replace it.

Due to long-standing government policies and international nonproliferation agreements, the U.S. military and national security agencies are forbidden from using foreign enrichment technology or foreign-sourced fuel for national defense purposes.

Centrus's proprietary technology, its AC100M centrifuge, is the only American-developed, deployment-ready uranium enrichment system available that complies with U.S. legal and national security requirements.

The company's first-mover advantage in uranium enrichment and growing backlog make the stock a solid buy. It is already growing revenue and is profitable, giving it a big advantage over other AI stocks. The stock's tumble appears related more to sector concerns than its financial health, which appears sound.

James Halley has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.