Babcock & Wilcox backlog jumps 470% on data-center gas power deal, but equity hole lingers
AI data-center power demand is pulling gas plant builders into hyperscaler supply deals, yet balance-sheet risk still caps the upside.
Babcock & Wilcox shares closed at $14.54, up 129.34% year to date, after the company disclosed a $2.4 billion design-build contract with Base Electron for 1.2 GW of natural gas-fired power. The deal drove backlog up 470% to $2.8 billion, according to company disclosures cited by AOL on Thursday (2026-05-21).3
The contract is a direct line from the AI data-center buildout into gas-fired generation equipment, the same channel that has lifted Fluence Energy this year. Babcock & Wilcox management guided 2026 core adjusted EBITDA to $70 million to $85 million, roughly 80% year-over-year growth, excluding any data center upside.3
The company is not resting on that single award. Base Electron is evaluating another 1.2 GW option, and the global pipeline exceeds $12 billion. If the second tranche converts, backlog would roughly double again, putting Babcock & Wilcox in position to book revenue well into 2028.3
Yet the stock carries baggage the rally has not erased. Stockholders' equity stands at negative $131.5 million, and the company faces a 6.50% note refinancing due in 2026. That combination means the growth story is running against a legacy balance sheet that could force dilutive action or expensive refinancing precisely when order momentum is strongest.3
The broader pattern is visible across the power-equipment complex. Fluence Energy, the battery storage provider, ran roughly 98% in one week in May (2026-05-18 to 2026-05-22) after reporting record backlog and signing master supply agreements with two major hyperscalers. Shares had a 52-week range of $4.40 to $33.51, with a market cap near $3.6 billion and a price-to-sales ratio around 1.23, according to Yahoo Finance data from Thursday (2026-05-21).1
Fluence management reaffirmed its 2026 revenue target of approximately $3.2 billion to $3.6 billion, citing visibility with 85% of the midpoint already contracted. Analysts project a strong third quarter as deferred revenue from Q2 shipments is realized, though sentiment remains tempered by recent secondary offerings and persistent net losses, according to Google Finance analysis from Thursday (2026-05-21).2
The supply chain snags that delayed Q2 deliveries are resolving. Management confirmed that approximately $80 million of shipments were affected, and analysts expect those realized deliveries to bolster upcoming quarterly results. But in mid-May (2026-05-14 to 2026-05-20), the company announced a secondary offering of 20 million Class A shares by existing holders, a reminder that insider selling often accompanies retail enthusiasm in this sector.2
The demand side shows no sign of cooling. The Economist reported on Tuesday (2026-05-19) that Nvidia beat expectations, selling close to $46 billion of semiconductors in the three months to July, and flagged a coming power shortage as the constraint on further growth. Too many chips, too little juice, as the magazine put it.4
Gas-fired plants can be permitted and built faster than nuclear or long-duration storage, making them the default bridge for hyperscalers that need megawatts on a two-year clock. Babcock & Wilcox's pivot into that niche, combined with its nuclear baseload positioning, gives it two legs in the AI power trade.3
The catch is execution risk. Adjusted EBITDA guidance of $70 million to $85 million on a $2.8 billion backlog implies thin near-term margins while the company works through fixed-price construction risk on a $2.4 billion design-build contract. Cost overruns on such jobs have broken bigger balance sheets than this one.3
Investors are pricing the story as pure growth. Year-to-date gains of 129.34% put the stock far ahead of the underlying earnings improvement, and the negative equity position means leverage is doing much of the work. A delay in the Base Electron option decision or a refinancing surprise would hit the stock harder than a miss on the broader AI narrative.3
The next signals are the 1.2 GW option decision and the note refinancing, both expected within the next two quarters. If the option converts and the refinancing lands at reasonable terms, the equity story gets cleaner. If either slips, the gap between the backlog headline and the balance sheet reality will close fast.3