Goldman Sachs Bullish on AI Energy Theme, Recommends Cameco as Top Commodity Pick

Goldman Sachs is making a bold prediction in the energy sector, particularly focusing on the intersection of artificial intelligence and energy consumption. The investment bank is emphasizing the potential surge in power demand driven by AI data centers, presenting lucrative opportunities for investors. In a recent report, Goldman Sachs equity analyst Carly Davenport outlined a basket of stocks poised to benefit from this anticipated growth in U.S. power demand.

According to Goldman Sachs’ forecast, the demand for electricity to power data centers is set to skyrocket, with a projected compound annual growth rate of 15% from 2023 to 2030. This surge is expected to elevate data centers’ share of total U.S. power demand to 8% by 2030, a significant increase from the current level of approximately 3%.

To meet this escalating demand, analysts estimate that an additional 47 gigawatts of power generation capacity will be required in the United States by 2030. This investment is anticipated to be split between gas and renewable energy sources, with approximately 60% coming from gas and 40% from renewables.

Goldman Sachs has identified 16 stocks across various sectors, including utilities, clean technology, energy services, and industrials, as prime investment opportunities. Among the highlighted stocks is Cameco Corporation (NYSE: CCJ), which is one of the worlds largest uranium producers.

Neil Mehta, an analyst at Goldman Sachs, recently initiated coverage on Cameco, issuing a buy rating and setting a price target of $55 per share. This optimistic outlook is based on Cameco’s strong market position and the anticipated increase in demand for uranium, which is expected to lead to higher prices.

Cameco last traded at $46.32 on NYSE. The $55 price target implies a potential upside of 19%.

READ: Cameco Shares Drop On Reported $7 Million Net Loss In Q1 2024

This comes almost two months after Cameco CFO Grant Isaac addressed concerns about the company’s market pricing and business model by sharing four key points. Firstly, he clarified that Cameco never sells below market value, despite prices sometimes being below the spot market. Secondly, he emphasized the company’s cautious approach to market timing, avoiding overexposure to market spikes. Thirdly, he assured that Cameco’s production expansion aligns with demand to prevent oversupply. Lastly, he highlighted Cameco’s role in offering balanced investment opportunities.

“Cameco never sells below the market,” Isaac reiterated.


Information for this briefing was found via Markets Insider and the sources mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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