BWX Technologies ( BWXT ) is riding a wave of surging demand for naval nuclear power systems and next-generation reactors, with a record $6 billion backlog and strengthened long-term growth prospects in defense, commercial energy, and space markets.

Bank of America Securities analyst Ronald J. Epstein reaffirmed a Buy rating and lifted his price forecast from $155 to $220, citing sustained demand for BWXT’s monopoly-supplied naval nuclear plants, expanding commercial opportunities in small modular reactors (SMRs), and increasing exposure to defense and space programs.

A recent $2.6 billion Navy agreement for submarine and carrier reactors secured a record backlog, ensuring revenue visibility over the next six to eight years. Epstein expects further upside as shipyard production rates improve.

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Epstein sees strong commercial upside from BWXT’s role as a key supplier of small modular reactors (SMRs), supported by federal plans to expand U.S. nuclear capacity to 400GW by 2050 and streamline approvals for modular and microreactors. He views progress on the TVA’s BWRX-300 SMR as a catalyst for wider adoption.

He also cites defense and space programs as growth drivers, with the Pele microreactor aligned to the U.S. military’s 2028 goal and NASA’s 2030 lunar nuclear plans expanding long-term potential. Epstein highlights the strategic value of the Special Materials business, including uranium enrichment under the DUECE program, bolstered by the A.O.T. acquisition.

Epstein raises the price objective to $220 from $155, applying a 33x EV/EBITDA multiple on 2026 estimates, a 2.4x premium to defense peers, justified by BWXT’s monopoly on nuclear-powered ships, robust Navy contracts, and growth in adjacent markets.

EPS forecasts now stand at $3.75 for 2025, $4.25 for 2026, and $4.90 for 2027, reflecting stronger profitability in Government Operations. He maintains a Buy rating, noting upside from AUKUS-related contracts, acquisitions, and aftermarket demand, while cautioning on risks tied to U.S. government contract changes or losses.

Second-Quarter 2025 Highlights

BWX Technologies ( BWXT ) reported adjusted EPS of $1.02, beating the 79 cents estimate. Revenue of $764 million topped the $707.997 million forecast. Net income was $78.5 million, with adjusted EBITDA of $145.9 million.

The backlog surged 70.2% year over year to $6.0 billion.

The company raised its FY2025 guidance, now projecting adjusted EPS of $3.65–$3.75, sales of $3.1 billion, adjusted EBITDA of $565–$575 million, and free cash flow of $275–$285 million.

Price Action: BWXT shares have climbed 57% year to date. The stock is trading lower by 2.52% to $174.98 at last check Wednesday.

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