Centrus Is Down 69% From Its High. Is Its $4.5 Billion Backlog Enough to Buy at $143?
2026-10-11 17:30
•Leo Sun •The Motley Fool
•• • Axe Cap view
Why Centrus’s Backlog Doesn’t Justify Its High Price
Centrus Energy’s steep fall and costly valuation make it a tough buy despite a $4.5B backlog.
Centrus Energy’s 69% drop from its 2025 peak shows investors’ discomfort with the nuclear fuel story. While a $4.5 billion backlog sounds impressive, most of that revenue will only materialize in the late 2020s. Meanwhile, capital spending remains heavy and earnings will likely shrink through 2028. Trading at around 50 times forward earnings, the stock is pricing in a flawless comeback that feels premature at best. South African investors should note that energy demand is shifting here too, making companies like Sasol more practical plays on local energy dynamics. Sasol benefits from immediate cash flow amid elevated energy prices, while Centrus’s gains, if any, remain years away. The rand’s sensitivity to global risk also suggests caution in chasing expensive foreign bets with lumpy payoffs. This might change if nuclear fuel demand surges and the backlog converts faster than expected, but that’s a big ‘if’. this is just our opinion and not financial advice
Avoid Centrus for now given the expensive valuation and delayed revenues. Instead, lean towards local energy stocks like Sasol that offer clearer near-term fundamentals.
- LEU
- Sasol
- USD/ZAR
- Nuclear fuel demand ramps up faster than expected
- Global energy policy shifts increase urgency for nuclear power
6/10
Centrus Energy's stock has plummeted 69% from its October 2025 high of $464.25 to $143, despite holding a robust $4.5 billion backlog. While the company benefits from growing nuclear demand and is the only U.S. public producer of HALEU fuel, near-term challenges persist: revenue is expected to decline through 2028, most backlog orders won't convert to revenue until the late 2020s, and capital-intensive expansion plans will pressure earnings. At 50x forward earnings, the stock appears expensive and lacks near-term catalysts.
Our take is based on reporting first published by The Motley Fool.