Against the backdrop of a Middle East war, the markets carried on yesterday with the major indexes up slightly. Investors continue to evaluate the ramifications of the war vis-à-vis their portfolio holdings.
In Tuesday trading, there were 80 new 52-week highs on the NYSE and 74 on the Nasdaq. As for new 52-week lows, the NYSE had 52, while the Nasdaq had 156. Those numbers should remain relatively subdued until investors are more confident of the direction of stocks in the short- and intermediate-term.
In yesterday’s trading, Babcock & Wilcox Enterprises (BW) caught my eye. With a volume of nearly 10 million on the day, the Ohio-based clean energy solutions provider hit its 19th new 52-week high of the past 12 months. Its shares are up 1,613% in the past year and 135% year to date.
Vaguely aware of the company, the roll it’s on piqued my interest. How could a company go from trading for pennies a year ago to nearly $15? That’s what I want to find out.
With a lot of twists and turns and plenty of risk, there’s a case to be made that it’s not too late for aggressive investors to own BW stock.
According to Perplexity AI, there are between 60 and 80 companies listed on the NYSE that are 100 years or older. Babcock & Wilcox Enterprises is one of them.
In 1856, George Babcock and Stephen Wilcox came together to build a boiler that was effective and safe. They formally created BW in 1867, the same year as Canada’s nationhood. Their water-tube steam boiler created steam-generated power. By 1878, it was selling its boiler to all kinds of businesses, including Thomas Edison, who got one for its machine shop in New Jersey.
By 1923, the company operated in several countries outside the U.S., including the UK and Canada. In 1969, the company installed the world’s largest boiler at the Tennessee Valley Authority, which today provides electricity to seven states, including Tennessee.
In March 1978, BW was acquired by McDermott International (MCDIF) for approximately $750 million in preferred stock, convertible into McDermott common. In 2010, McDermott spun off the company. Five years later, Babcock & Wilcox Enterprises was spun off from the firm’s power generation business.
So, BW stock’s been trading for about 10 years. Its shares traded at over $124 less than a year after the spinoff in April 2016. They’ve lost 88% of their value since then.
That brings us up to the present day.
The first move came last September, when it announced a partnership with Denham Capital to provide the engineering and technology know-how to the investment firm’s Infrastructure arm as it pursues the conversion of coal-fired plants to natural gas to meet America’s rising need for more power to run all of the AI data centers popping up.
At that point, BW’s share price was $2.63.
In late October, it announced it had been selected to conduct an engineering study for Cache Power Corp.’s Compressed Air Energy Storage (CAES) and Hydrogen Hub Project in Alberta. Once completed, the 640MW (megawatts) facility will utilize Babcock & Wilcox’s proprietary BrightLoop energy production and decarbonization technology.
By then, its shares were $3.46.
On Nov. 4, BW announced it had been selected to design and install four 300MW natural gas-fired power plants at Applied Digital’s (APLD) AI data centers in the U.S. The $1.5 billion in power plants are expected to go online in 2028.
After the announcement, BW shares were around $7.
On March 4, 2026, BW announced that it had gotten the green light to proceed with the four power plants for Base Electron, a power producer backed by Applied Digital. Only now, the project’s valued at $2.4 billion with the potential for an additional 1.2 GW (gigawatts) of power in the future.
That’s gotten the shares to $14.
At the same time as the $2.4 billion announcement, the company reported annual sales of $588 million and adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) of $43.7 million, double its adjusted EBITDA profit a year earlier.
The most important number in the Q4 2025 press release wasn’t the non-GAAP profit, but the $2.8 billion backlog, 470% higher than in 2024.
The big question for investors isn’t whether the $2.8 billion figure is accurate — it includes the $2.4 billion for the 1.2GW Base Electron project — but what the profitability will be.
On a GAAP basis in 2025, it lost $33 million, down from $104 million in 2024, on virtually the same top-line revenue. In the past two quarters, its trailing 12-month cash flow used has dropped from $125.8 million in Q2 2025 to $68.9 million in Q4 2025, according to S&P Global Market Intelligence.
While it’s on track to generate positive cash flow by the end of 2026, it’s still really early to determine what the $800 million in average additional revenue provided by the Base Electron project over the next three years will do to the bottom line.
The four analysts covering BW stock have a 2028 earnings-per-share estimate of $0.84. Based on this, its shares trade at 17 times this estimate, which is fair given that Babcock & Wilcox should have over $1 billion in annual revenue by then, possibly much more if things go its way.
If my mom were asking me whether she should invest in BW stock, I would tell her absolutely not; the risks are too high for someone interested in income with a splash of capital gains.
But if you’re someone in their 20s or 30s and don’t need the money for 3-5 years, the potential for big gains is appealing.
The biggest risk to shares continuing their climb is if AI loses its attractiveness, whether through a deep recession or the technology being proven to be more hype than help. Both are certainly possible.
If you’re ready for twists, turns, and big risks, I say go for it, but only if it’s a small portion of your overall portfolio.
On the date of publication, Will Ashworth did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com
