Q: Given North American renewed interest in nuclear power and a general trend in buying domestic can you comment on SNC’s potential in this space.Particularily given both Hydro Quebec and Bruce nuclear ambitions is there a better name to look at?
5i Research Answer:
Many companies in the nuclear space are either government entities or divisions of larger companies. But for E&P companies, SNC has significant industry experience and it has won several contracts in various countries this year. As an indirect play on the sector, it works, and it has a big backlog. It has not been our favourite company, for various growth reasons and scandals, but things have improved immensely and very strong earnings growth is now expected. It is not 'cheap' at 27X earnings but for a nuclear-focused investor we think it has some attractions.