Unilever's Retreat from Core Assets and the Hidden Energy Giant Powering the AI Revolution

As Unilever (UL) continues its strategic pivot toward personal care—a move distancing it from legacy food and beverage operations—the energy sector is quietly positioning itself to profit from a parallel boom: the insatiable power demands of artificial intelligence (AI). While Unilever's restructuring highlights the risks of overexposure to commoditized industries, one undervalued energy infrastructure company is poised to capitalize on the AI energy revolution. This firm combines a debt-free balance sheet, critical nuclear and LNG assets, and strategic synergies with data center growth—all under the radar of Wall Street.

Unilever's Strategic Shift: A Cautionary Tale of Overexposure

Unilever's decision to divest its spreads and tea businesses signals a broader retreat from mature markets. The company's Q1 2025 earnings revealed a 5% drop in core margins, driven by stagnant demand in developed economies and rising input costs. By focusing on high-margin personal care segments like skin health and sustainability-focused products, Unilever aims to realign with growth trends. Yet this pivot also underscores a truth: companies overly reliant on commoditized assets face declining relevance in a world demanding innovation and scale.

In contrast, the energy infrastructure sector is undergoing a renaissance. The AI revolution—driven by hyperscale data centers, cloud computing, and edge networks—requires 24/7 reliable power at unprecedented scale. This has created a golden opportunity for firms that own the physical infrastructure to meet these demands.

The Hidden Giant: Entergy Corp. (ETR) — Debt-Free, Nuclear-Powered, and AI-Ready

Entergy Corp., a regional utility with a $13 billion market cap, is the undervalued star of this narrative. Here's why:

1. Nuclear Assets as the “Toll Booth” of Energy Infrastructure
2. Entergy operates four U.S. nuclear plants, including the 2,234 MW Grand Gulf facility. Nuclear power's reliability and low-carbon profile make it ideal for powering AI data centers, which demand 24/7 uptime.

3. Unlike renewables, nuclear plants offer baseload power, a critical hedge against intermittency—a flaw that has plagued solar/wind-driven data centers.

4. LNG Exposure via Lake Charles Terminal

5. Entergy's 50% stake in the Lake Charles LNG terminal provides exposure to soaring global LNG demand. Goldman Sachs forecasts U.S. LNG exports to hit 10 million metric tons annually by 2026, with Entergy positioned to capture $400 million/year in EBITDA gains by 2026.

6. Debt-Free Balance Sheet and Strategic Partnerships

7. Debt-to-Equity Ratio: 0.0x (Entergy carries no long-term debt).
8. Cash Reserves: $1.5 billion, fueling expansion into AI-driven energy infrastructure.

9. Partnerships: Entergy's collaboration with Cloudburst Group and its Delta Blues Advanced Power Station (launching .2026) are designed to colocate data centers with power generation, minimizing transmission losses and operational costs.

10. Undervalued at 6.8x P/E

11. Entergy trades at a 40% discount to its peers in the utilities sector. This undervaluation persists despite its strategic advantages and the AI energy boom's tailwinds.

Why Wall Street Isn't Seeing It Yet—and Why You Should Act Now

Entergy's potential remains overlooked for two reasons:
1. Focus on “Glamour Sectors”: Investors are fixated on AI software names (e.g., Palantir, NVIDIA) or renewables, ignoring the physical infrastructure enabling these trends.
2. Legacy Utility Stereotypes: Entergy is still viewed as a staid regional utility, not a high-growth infrastructure play.

This is a critical misread. The $400 billion AI data center market (Goldman Sachs) is driving demand for energy infrastructure that Entergy uniquely owns. Its nuclear plants and LNG assets are not just defensive—they're offensive tools in a sector where energy density and reliability are existential to AI's success.

The Catalysts Coming in 2025–2026

• Fermi America's HyperGrid Campus: Entergy's proximity to Texas's Amarillo site—hosting the world's largest nuclear/AI complex—will amplify its role in supplying power to hyperscalers.
• NOS (Nuclear Operating System): Palantir's software, co-developed with The Nuclear Company, could reduce nuclear plant construction costs by 30%—a win for Entergy's expansion plans.
• Regulatory Tailwinds: Trump's executive orders aim for 10 U.S. nuclear reactors by 2030, shielding Entergy's assets from obsolescence.

The Investment Thesis: Buy Entergy Before the Crowd Catches On

Price Target: $55/share (vs. current $40.50) based on a 9.5x P/E multiple—still a discount to peers.

Risks: Delays in LNG terminal expansions or regulatory setbacks in nuclear approvals.

Action:
- Buy Now: Entergy's valuation is a rare mispricing in an overbought market.
- Set a Target: Aim for a 35% return within 12 months as AI/data center demand accelerates.

Conclusion: The AI Energy Boom Isn't Virtual—It's Physical

Unilever's pivot highlights the perils of clinging to outdated business models. Meanwhile, Entergy embodies the future: a debt-free, asset-heavy company with nuclear/LNG assets and direct ties to the AI infrastructure boom. This is a once-in-a-decade opportunity to invest in the unsung heroes of the energy revolution—before Wall Street finally notices.

The time to act is now.