Analysis of Small Modular Reactor Market Competition
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2 days ago
0mins
Source: NASDAQ.COM
- Market Positioning Differences: NuScale Power is the only small modular reactor design to receive U.S. regulatory certification, focusing on providing carbon-free electricity to traditional utilities and industrial clients, while Oklo targets high-demand users like data centers through fast-fission plants and a unique fuel recycling business model, highlighting significant differences in their market positioning.
- Financial Comparison: NuScale ended the first quarter with $341 million in cash and cash equivalents and $836 million in short-term investments, facing milestone payment risks with ENTRA1 Energy despite not yet commercializing; in contrast, Oklo boasts over $2 billion in cash reserves, showcasing greater financial flexibility, although both companies are pre-revenue.
- Impact of Partnerships: Oklo has secured prepayment agreements with major tech firms like Meta Platforms and Equinix, along with a master power agreement with Switch for 12 GW of capacity, enhancing market confidence; in comparison, NuScale's commercialization partnerships are more limited, increasing uncertainty about its future revenue.
- Technological Progress and Challenges: Oklo aims to achieve criticality at its Groves Isotope Test Reactor in Texas by July 4 and is making strides in nuclear fuel recycling, demonstrating its technological edge; meanwhile, NuScale faces competition from large state-supported entities like China National Nuclear Corporation and risks regarding the competitiveness of its electricity costs.
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Analyst Views on SMR
Wall Street analysts forecast SMR stock price to rise
13 Analyst Rating
5 Buy
6 Hold
2 Sell
Hold
Current: 12.190
Low
18.50
Averages
32.77
High
60.00
Current: 12.190
Low
18.50
Averages
32.77
High
60.00
About SMR
NuScale Power Corporation is a provider of proprietary advanced small modular reactor (SMR) nuclear technology. The NuScale Power Module, the Company's SMR technology, is a small pressurized water reactor that can generate approximately 77 megawatts of electricity (MWe) or 250 megawatts thermal (gross) and can be scaled to meet customer needs through an array of flexible configurations of up to 924 MWe (12 modules) of output. In addition to the sale of NPMs, it offers a diversified suite of services throughout the development and operating life of the power plant. The Company's suite of services is planned to include licensing support, testing, training, fuel supply services and program management, among others. It serves a range of customers consisting of domestic and international governments, utilities, state-owned enterprises and technology and industrial companies in need of carbon-free, reliable energy.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
NuScale Power: A Unique Opportunity in Nuclear Energy Investment
- Nuclear Market Potential: The nuclear energy market is projected to reach $10 trillion over the next few decades, primarily driven by the global build-out of data center infrastructure, positioning NuScale Power as a pioneer in small modular reactors to capitalize on this trend.
- Energy Demand from Data Centers: The pace of global data center construction is unprecedented, with spending expected to reach $7 trillion by 2030, making NuScale's nuclear solutions particularly relevant due to their rapid construction capabilities to meet the urgent energy needs of AI technologies.
- Low-Carbon Power Advantage: NuScale's small modular reactors require refueling every 3 to 7 years and emit very little carbon, aligning with major tech companies' commitments to reduce their carbon footprints, thus becoming an ideal choice for sustainable energy.
- Future Growth Potential: Although NuScale has yet to bring its first system online, it is expected to enter a strong growth phase once construction begins, especially against the backdrop of rising global demand for clean energy.
See More
Emerging Competitors in the Nuclear Energy Sector
- Market Opportunity: Bank of America estimates the nuclear energy market could be worth $10 trillion, with Oklo and NuScale Power driving a resurgence in nuclear technology expected to yield significant growth over the coming decades.
- Business Model Differences: Oklo focuses on providing reliable power to data centers through power purchase agreements, while NuScale partners with ENTRA1 to sell its small modular reactor technology, offering global market opportunities despite a more complex model.
- Client Appeal: Oklo's direct approach allows it to meet data center demands more rapidly, having established significant partnerships with clients like Equinix, Switch, and Meta Platforms, whereas NuScale has yet to secure major deals with large data centers.
- Regulatory Risk Considerations: While Oklo's business model is more appealing, it lacks NRC approval for its reactor designs, whereas NuScale can leverage partners to manage the complexities of nuclear projects, providing greater regulatory certainty.
See More
Oklo and NuScale Design Small Nuclear Reactors
- Significant Market Opportunity: Oklo and NuScale are developing small nuclear reactors, expected to drive growth in the nuclear sector, with Bank of America estimating this market opportunity at $10 trillion, indicating potential returns for decades to come.
- Differing Business Models: Oklo plans to sell electricity directly to customers through power purchase agreements, while NuScale partners with ENTRA1 to sell its reactor technology; although NuScale's model is more complex, it provides access to the global market.
- Alignment with Client Needs: Oklo's model is particularly suited for industrial clients like data centers that seek clean, reliable power without the complexities of owning and operating a power plant, making Oklo more attractive in the market.
- Notable Project Potential: NuScale's partnership with ENTRA1 has initiated a 6GW SMR project, which, if successful, would become the largest SMR deployment in the U.S., further solidifying its position in the nuclear energy market.
See More
NuScale Power Shares Plunge 62% Amid Capital Raise and Revenue Decline
- Stock Performance Decline: NuScale Power's shares have plummeted over 62% in the past year, dropping from a peak of $57.42 to the current price of $12.19, reflecting a pessimistic market sentiment, although this presents a buying opportunity for patient investors.
- Capital Raising Initiative: The company plans to sell up to $500 million in stock to raise capital, a common move for growth companies, yet it has raised concerns about shareholder dilution, further impacting market confidence.
- Revenue Decrease: NuScale reported projected revenue of $31.5 million for 2025, down from $37 million in 2024, indicating challenges in revenue growth, despite maintaining a leading position in the small modular reactor sector.
- Design Approval Advantage: Unlike its peers, NuScale is the only developer of small modular reactors that has received design approvals from the U.S. Nuclear Regulatory Commission (NRC), providing a critical gateway to commercial operations, especially as data centers increasingly seek efficient power solutions amid rising demands.
See More
NuScale Power Stock Decline Presents Buying Opportunity
- Significant Stock Decline: NuScale Power's shares have plummeted over 62% in the past year, and while market sentiment has soured, this presents a potential buying opportunity for patient investors willing to endure volatility.
- Capital Raising Initiative: The company has filed to sell up to $500 million in stock to raise capital, a common move for growth companies, although this has raised concerns about shareholder dilution, with projected 2025 revenue at $31.5 million, down from $37 million in 2024.
- Design Approval Advantage: NuScale stands out as the only developer of small modular reactors that has received design approvals from the U.S. Nuclear Regulatory Commission, providing a
See More
Analysis of the U.S. Nuclear Energy Market Outlook
- Nuclear Capacity Goals: The U.S. aims to quadruple its nuclear power capacity by 2050, with small modular reactors (SMRs) expected to become the backbone of a new nuclear era, enhancing the significance of nuclear energy in the global energy landscape.
- Oklo's Progress: Oklo is developing a small fast reactor called Aurora, and despite regulatory hurdles, it has broken ground at the Idaho National Laboratory and is exploring partnerships with tech giants like Switch and Meta, potentially tapping into a multibillion-dollar medical isotope market.
- NuScale Power's Competitive Edge: NuScale has achieved NRC approval for two SMR designs, 50 MW and 77 MW, showcasing its potential for large-scale infrastructure projects, particularly highlighted by a 6-gigawatt collaboration with the Tennessee Valley Authority.
- Market Outlook and Risks: While both Oklo and NuScale have distinct advantages in the small nuclear reactor space, they face challenges with revenue generation and market uncertainty, requiring investors to carefully assess their potential value amid the growing demand from data centers.
See More
NuScale Power: A Unique Opportunity in Nuclear Energy Investment
- Nuclear Market Potential: The nuclear energy market is projected to reach $10 trillion over the next few decades, primarily driven by the global build-out of data center infrastructure, positioning NuScale Power as a pioneer in small modular reactors to capitalize on this trend.
- Energy Demand from Data Centers: The pace of global data center construction is unprecedented, with spending expected to reach $7 trillion by 2030, making NuScale's nuclear solutions particularly relevant due to their rapid construction capabilities to meet the urgent energy needs of AI technologies.
- Low-Carbon Power Advantage: NuScale's small modular reactors require refueling every 3 to 7 years and emit very little carbon, aligning with major tech companies' commitments to reduce their carbon footprints, thus becoming an ideal choice for sustainable energy.
- Future Growth Potential: Although NuScale has yet to bring its first system online, it is expected to enter a strong growth phase once construction begins, especially against the backdrop of rising global demand for clean energy.
See More
Emerging Competitors in the Nuclear Energy Sector
- Market Opportunity: Bank of America estimates the nuclear energy market could be worth $10 trillion, with Oklo and NuScale Power driving a resurgence in nuclear technology expected to yield significant growth over the coming decades.
- Business Model Differences: Oklo focuses on providing reliable power to data centers through power purchase agreements, while NuScale partners with ENTRA1 to sell its small modular reactor technology, offering global market opportunities despite a more complex model.
- Client Appeal: Oklo's direct approach allows it to meet data center demands more rapidly, having established significant partnerships with clients like Equinix, Switch, and Meta Platforms, whereas NuScale has yet to secure major deals with large data centers.
- Regulatory Risk Considerations: While Oklo's business model is more appealing, it lacks NRC approval for its reactor designs, whereas NuScale can leverage partners to manage the complexities of nuclear projects, providing greater regulatory certainty.
See More
Oklo and NuScale Design Small Nuclear Reactors
- Significant Market Opportunity: Oklo and NuScale are developing small nuclear reactors, expected to drive growth in the nuclear sector, with Bank of America estimating this market opportunity at $10 trillion, indicating potential returns for decades to come.
- Differing Business Models: Oklo plans to sell electricity directly to customers through power purchase agreements, while NuScale partners with ENTRA1 to sell its reactor technology; although NuScale's model is more complex, it provides access to the global market.
- Alignment with Client Needs: Oklo's model is particularly suited for industrial clients like data centers that seek clean, reliable power without the complexities of owning and operating a power plant, making Oklo more attractive in the market.
- Notable Project Potential: NuScale's partnership with ENTRA1 has initiated a 6GW SMR project, which, if successful, would become the largest SMR deployment in the U.S., further solidifying its position in the nuclear energy market.
See More
NuScale Power Shares Plunge 62% Amid Capital Raise and Revenue Decline
- Stock Performance Decline: NuScale Power's shares have plummeted over 62% in the past year, dropping from a peak of $57.42 to the current price of $12.19, reflecting a pessimistic market sentiment, although this presents a buying opportunity for patient investors.
- Capital Raising Initiative: The company plans to sell up to $500 million in stock to raise capital, a common move for growth companies, yet it has raised concerns about shareholder dilution, further impacting market confidence.
- Revenue Decrease: NuScale reported projected revenue of $31.5 million for 2025, down from $37 million in 2024, indicating challenges in revenue growth, despite maintaining a leading position in the small modular reactor sector.
- Design Approval Advantage: Unlike its peers, NuScale is the only developer of small modular reactors that has received design approvals from the U.S. Nuclear Regulatory Commission (NRC), providing a critical gateway to commercial operations, especially as data centers increasingly seek efficient power solutions amid rising demands.
See More
NuScale Power Stock Decline Presents Buying Opportunity
- Significant Stock Decline: NuScale Power's shares have plummeted over 62% in the past year, and while market sentiment has soured, this presents a potential buying opportunity for patient investors willing to endure volatility.
- Capital Raising Initiative: The company has filed to sell up to $500 million in stock to raise capital, a common move for growth companies, although this has raised concerns about shareholder dilution, with projected 2025 revenue at $31.5 million, down from $37 million in 2024.
- Design Approval Advantage: NuScale stands out as the only developer of small modular reactors that has received design approvals from the U.S. Nuclear Regulatory Commission, providing a
See More
Analysis of the U.S. Nuclear Energy Market Outlook
- Nuclear Capacity Goals: The U.S. aims to quadruple its nuclear power capacity by 2050, with small modular reactors (SMRs) expected to become the backbone of a new nuclear era, enhancing the significance of nuclear energy in the global energy landscape.
- Oklo's Progress: Oklo is developing a small fast reactor called Aurora, and despite regulatory hurdles, it has broken ground at the Idaho National Laboratory and is exploring partnerships with tech giants like Switch and Meta, potentially tapping into a multibillion-dollar medical isotope market.
- NuScale Power's Competitive Edge: NuScale has achieved NRC approval for two SMR designs, 50 MW and 77 MW, showcasing its potential for large-scale infrastructure projects, particularly highlighted by a 6-gigawatt collaboration with the Tennessee Valley Authority.
- Market Outlook and Risks: While both Oklo and NuScale have distinct advantages in the small nuclear reactor space, they face challenges with revenue generation and market uncertainty, requiring investors to carefully assess their potential value amid the growing demand from data centers.
See More
