NASA Wants to Build a Nuclear Reactor on the Moon. This Stock Could Benefit.

NASA wants a nuclear reactor on the moon by 2030. (SAEED KHAN/AFP via Getty Images)

“To the moon” is a euphemism, typically expressed through the image of a toy rocket, that has been famously co-opted by meme stock and retail traders around the world.

Usually, they’re talking about an undervalued company that has soaring in price and outpacing the market. This week, the catchphrase took on a more literal meaning.

BWX Technologies , a Lynchburg, Virginia-based maker of nuclear reactors for the U.S. government, added around 18%, or $2.5 billion, to its market value yesterday, in part because investors tied it to a key NASA initiative.

The space agency’s Fission Surface Power Project, which first aimed to have a nuclear reactor ready for the moon by 2030, got a big jump-start last night from Transportation Secretary Sean Duffy.

Duffy, who also serves as the acting administrator for NASA, unveiled plans to fast-track the project, following a joint move by China and Russia to accelerate their own efforts to establish an atomic energy source on the lunar surface by 2036.

“We’re in a race to the moon, in a race with China to the moon. And to have a base on the moon, we need energy,” Duffy told reporters during a press conference late Tuesday. “This fission technology is critically important…let’s start to deploy our technology to move to actually make this a reality.”

Duffy said he wants a reactor that generates 100 kilowatts of power, and he wants it up and running on the lunar surface within the next five years, as the agency advances its goal of increasing manned space flights.

NASA hopes to have Artemis III, a ship tied to its plans to have humans back on the moon for the first time in five decades, on the moon by 2027. It also wants to use private companies to ferry equipment back and forth as it looks to boost capacity while lowering costs.

“Energy is important, and if we’re going to be able to sustain life on the moon, to then go to Mars, this technology is critically important,” Duffy said.

Step forward BWX Technologies, which began working with NASA and the Department of Energy on a nuclear thermal propulsion design in 2017.

The group also partnered with defense giant Lockheed Martin to win a NASA contract worth $5 million in 2022 to designed the first iterations of the lunar power systems. Westinghouse and Aerojet Rocketdyne, as well as a joint venture that included Boeing , were also selected.

“The demand for nuclear solutions in the global security, clean energy, and medical markets continues to accelerate,” said BWX CEO Rex Geveden following the group’s second-quarter earnings on Monday. “In our 10 years as a stand-alone public company, BWX has built significant industrial scale, leading to one of the broadest and highest quality portfolios in the nuclear market.”

The group’s overall order backlog has grown by more than 70% over the past year to a record $6 billion, and it sees adjusted earnings in the region of $570 million, or $3.70 a share, for its current financial year.

NASA, meanwhile, is expected to choose two companies for its accelerated Fission Surface Power Project from a list of proposals from industry players over the next two months.

Officials from BWX Technologies weren’t immediately available for comment when contacted by Barron’s.

BWX stock had dropped 1.8% in midday trading Wednesday, but remain up more than 92% this year.

To the moon, indeed.

Write to Martin Baccardax at martin.baccardax@barrons.com