Goldman sees clean energy bill impact varying across sector

Goldman Sachs released an analysis Monday on the Senate’s proposed clean energy legislation, highlighting divergent impacts across the renewable energy sector.

The investment bank identified First Solar (NASDAQ:FSLR), NextEra Energy (NYSE:NEE) (NYSE:NXT), and Array Technologies (NASDAQ:ARRY) as potential beneficiaries of the bill. These companies primarily have exposure to manufacturing tax credits under Section 45X, which remain "relatively unchanged" and extend through the end of 2031.

Sunrun (NASDAQ:RUN), Enphase Energy (NASDAQ:ENPH), and SolarEdge Technologies (NASDAQ:SEDG) face the most negative impact from the proposal, according to Goldman. The bank noted the bill "specifically calls out leasing and rental models which will not be eligible for tax credits starting in 2026."

Nuclear energy companies Cameco (NYSE:CCJ) and NuScale Power (NYSE:SMR) could benefit from the legislation. Goldman cited "positive commentary around nuclear PTC (NASDAQ:PTC) and ITCs" in the proposal, along with "relatively longer runway availability for these credits for nuclear." Cameco, with its $30.2 billion market capitalization, has shown remarkable strength, gaining over 35% year-to-date. According to InvestingPro data, the company maintains a "GREAT" financial health score, and analysts maintain a strong buy consensus with 7 recent upward earnings revisions.Discover more insights and detailed analysis in Cameco’s comprehensive Pro Research Report, available exclusively on InvestingPro.

Goldman Sachs emphasized it takes "no view on the final outcome of the bill" while assessing its potential sector-wide implications should the current Senate proposal advance. Based on InvestingPro’s analysis, Cameco’s strong revenue growth of nearly 30% in the last twelve months positions it well to capitalize on potential legislative benefits.

In other recent news, Cameco Corporation has been the subject of several analyst updates and projections. Desjardins raised its price target for Cameco to C$105, maintaining a Buy rating, influenced by a one-time US$170 million EBITDA increase from Westinghouse Electric’s involvement in the Dukovany power plant. Raymond (NSE:RYMD) James also increased Cameco’s price target to Cdn$96, citing the company’s strong position in the uranium market and its diversified contracts that offer stability against price volatility. BMO Capital Markets followed suit, raising its price target to C$95, highlighting a lucrative deal with Korea Hydro & Nuclear Power that is expected to significantly boost Cameco’s EBITDA.

Goldman Sachs resumed coverage of Cameco with a Buy rating, setting a price target of C$89. The firm points to growth in nuclear demand and pricing advantages as key factors for the company’s potential success. Analysts at Goldman Sachs also emphasize the strategic importance of Cameco’s assets, which contribute significantly to global uranium production. They note that Cameco’s 49% stake in Westinghouse Electric could unlock substantial shareholder value, particularly with increased nuclear activities. These developments collectively reflect a positive outlook for Cameco, with analysts expressing confidence in the company’s growth trajectory and strategic positioning within the nuclear energy sector.

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