Fermi America LLC (NASDAQ:FRMI) stock rose 3.5% in premarket trading Thursday after the company announced continued momentum in its strategic partnership with Hyundai Engineering & Construction to help revive large-scale nuclear construction in the United States.
The two firms are progressing Front-End Engineering Design - or FEED - for four AP1000 nuclear units that are envisioned as part of Project Matador, an 11-gigawatt private energy campus planned near Amarillo, Texas. Fermi recently took part in Hyundai E&C's Large-Scale Nuclear Technology Seminar held in Dallas, an event that convened leaders from the U.S. construction and nuclear sectors.
The collaboration is intended to draw on Hyundai's record of constructing 24 reactors worldwide to support Fermi's development agenda. Current engineering activities explicitly cited by the companies include site layout planning, evaluations of cooling systems and the development of cost and schedule estimates.
Company executives framed the project in the context of rising electricity needs tied to fast-growing digital and industrial loads. "AI-driven load growth is accelerating faster than most people realize," said Mesut Uzman, Chief Nuclear Construction Officer of Fermi America. "The next decade will be defined by those who can build power infrastructure fast enough to support AI and industrial growth."
Project Matador is being developed to supply reliable baseload power aimed at meeting increasing demand from AI infrastructure, data centers and advanced manufacturing. As part of preparatory work, the companies said they are mobilizing contractors, reinforcing workforce pipelines and pursuing steps to rebuild the nuclear supply chain required for new, large-scale nuclear power plants.
On the analyst front, Citizens analyst Greg Miller left a Market Outperform rating in place on Fermi and kept a $30.00 price target. Miller noted that the project remains "still very nascent and highly speculative," while also saying the company has established "building blocks to become a legitimate alternative to large hyperscale customers that are seeking alternatives to grid-based power solutions."
The announcement and subsequent engineering progress underline the two firms' focus on foundational work - layout, cooling and cost and schedule plans - that will be needed before more advanced construction phases can proceed. At the same time, the comments from the analyst and the companies themselves emphasize the early-stage, speculative nature of the effort and the need to rebuild contractor and supply chain capabilities for large-scale nuclear deployment.
Key points
- Fermi America shares rose 3.5% in premarket trading after news of progress with Hyundai E&C on FEED for four AP1000 units.
- FEED work for Project Matador covers site layout planning, cooling system evaluations, and cost and schedule development for the 11-gigawatt private energy campus near Amarillo, Texas.
- The partnership seeks to leverage Hyundai's experience building 24 reactors globally and aims to mobilize contractors and strengthen workforce and supply chain capabilities to support new large-scale nuclear plants.
Risks and uncertainties
- The project is described as "still very nascent and highly speculative," indicating material uncertainty about its development and outcomes - a risk to investors and to sectors relying on future power supply, including technology and industrials.
- Rebuilding the nuclear supply chain and strengthening workforce pipelines are cited as necessary actions, reflecting execution and labor market risks that could affect construction timelines and costs in the energy and construction sectors.
- Ongoing cost and schedule development work implies uncertainty around final project economics and timing, posing potential impacts for financers, contractors and customers seeking alternative power solutions.