AtkinsRéalis Group Inc. (TSE:ATRL) saw its shares climb 4.81% to C$91.87 in Toronto trading on Friday, significantly outperforming the broader market. The S&P/TSX Composite Index rose only 0.87% to 35,271.48 during the same period.
Market Reaction and Valuation
The single-day gain added approximately C$683 million to the company's equity value, based on its 161.92 million outstanding shares. This surge represents about 93% of AtkinsRéalis's first-quarter nuclear revenue of C$736.6 million, highlighting the market's optimism regarding potential export opportunities.
Turkey Nuclear Review
The catalyst for the move was news that Turkey is conducting an initial assessment of AtkinsRéalis's CANDU reactor technology. Gary Rose, executive vice president at AtkinsRéalis, confirmed to Reuters that the company is providing information to Turkey's state plant operator TUNAS for a report due this summer. The review could potentially lead to direct negotiations for a nuclear plant bid.
Turkey already has one nuclear plant under construction with Russia's Rosatom, a $20 billion, 4.8 GW project. The government is also in discussions with South Korea's KEPCO and China's SPIC for two additional plants. However, Turkey still needs 2.4 GW to meet its 2035 interim nuclear target, creating a potential opportunity for CANDU technology.
Company Fundamentals
AtkinsRéalis's nuclear segment has been a strong performer. First-quarter nuclear revenue jumped 36.8% year-over-year to a record C$736.6 million, while total revenue rose 17.8% to C$3.0 billion. The company's backlog stood at C$20 billion at the end of the quarter. CEO Ian L. Edwards noted in May that demand for the company's capabilities remains strong.
In March, AtkinsRéalis signed a memorandum of understanding with TUNAS to evaluate CANDU technology for Turkish sites, covering regulatory, licensing, financing, and delivery models. No contract value was disclosed.
Analyst Outlook and Risks
Analysts remain bullish on the stock. Investing.com lists a 12-month average price target of C$114.53, with a high of C$131 and a low of C$99. The consensus includes 15 buy ratings and no sell ratings, implying approximately 25% upside from Friday's close.
However, investors face timing risk. The share price already reflects expectations of an export deal, but there is no confirmed bid, contract size, or award timeline. AtkinsRéalis is scheduled to report earnings on July 30, which will provide further insight into nuclear margins and backlog conversion.
