BWX ($BWXT) podcast mentions
Who you are? Jim, this company has $8.4 billion in backlog, huge exposure to the U.S. nuclear Navy and growing its advanced reactor opportunities. Yet the stock sits near its 52-week low. At this valuation, isn't BWX Technology a major buying opportunity right here? No, I'll tell you the problem with BWXT. The price-to-earnings multiple at 30 is too high. I think it's a great company. I mean, really terrific, but it's too expensive even though it has nuclear. We have to hold off.
Jim Cramer · Mad Money w/ Jim Cramer · Mad Money w/ Jim Cramer 9/16/26 · 2026-09-16All right, looking at VST versus BWXT. Now we own BWXT, we do not own VST. Now VST is more of a utility company. It's not a bad utility company, it's fine. Operates in Texas, but its profitability and its leverage is— its profitability is good, its leverage is very high. I don't have any major issues with it. However, its business is pretty up and down, lost money in 2021 and 2022. I just don't— we just don't think this is a great long-term secular hold versus BWXT's earnings continue to grow pretty much year after year, and they are more in the nuclear, nuclear business. So they're selling the picks and shovels of the energy business as opposed to in the energy business, which tends to be fairly regulated, can be very cyclical as well. We just think BWXT, BWX Technologies, is in the heart of the nuclear renaissance, both on the military scale as well as from an energy perspective. And it has come down, but it's now at a pretty reasonable valuation. $5.29 in earnings next year, that's up 12% from this year. $4.74, that's up 18% from last year. So continued to see good secular growth and earnings expectations continue to move higher. So for picking one or the other, I'm definitely going BWXT. Let's talk a little bit about interest rates. Interest rates, we said before, 10 years approaching 5% once again, and A lot of people are asking, when do these yields crack the stock market? We know that in highly indebted economies, high interest rates tends to crack something. Even if you go back hundreds of years, every major bubble ended when borrowing costs rose significantly for companies at the core of the economy. Now, there's no magic number that automatically tips over equities, but there are reasons why high rates impact parts of the economy. Number one is high rates slow the cyclical parts of the business sectors. Profits fall, stocks follow, and then sentiment shifts. That's number one. Then you have higher rates reduce the present value of companies' future cash flows. Making stocks less valuable. And then high rates also pull capital away from stocks and into bonds as they are safer. And, you know, if rates go up enough, well, might make more sense to be in bonds.
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