NuScale Power Downgraded to Hold Amid Project Delay Concerns
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4 days ago
0mins
Should l Buy SMR?
Source: seekingalpha
- Rating Downgrade: TD Cowen downgraded NuScale Power from Buy to Hold due to concerns that its first small modular reactor project may be delayed to 2034, resulting in a 6.9% drop in the company's stock on Wednesday.
- Project Update: NuScale's customer Nuclearelectrica is set to make a final investment decision on its Doicesti small modular reactor project this week; while analysts expect the project to move forward, new approval conditions will shift more risk to NuScale, pushing the expected start of operations to 2033 or 2034 from the original target of 2030.
- Financial Impact: The analyst noted that the near-term financial impact on NuScale is limited, but the added performance risk could become more significant if the initial module does not operate as expected, potentially affecting investor confidence in the future.
- Industry Validation: Bianchi believes that other nuclear utilities are using the Doicesti project as a test case, and its success will serve as an important validation point for NuScale's commercial potential, which may influence decisions by other companies in the sector.
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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: 13.990
Low
18.50
Averages
32.77
High
60.00
Current: 13.990
Low
18.50
Averages
32.77
High
60.00
About SMR
NuScale Power Corporation is a provider of proprietary advanced small modular reactor nuclear technology. The NuScale Power Module, the Company's SMR technology, is a small pressurized water reactor that can generate 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 governments, political subdivisions, state-owned enterprises, investor-owned utilities and other technology and industrial companies, both in domestic and international markets.
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 Advances in Small Modular Reactor Design
- Technological Potential: NuScale Power focuses on designing small modular reactors (SMRs), which, despite not being commercially deployed yet, have the potential to meet the 24/7 electricity demands of data centers, particularly in applications related to artificial intelligence.
- Financial Condition: The company currently has a market cap of $4.5 billion, while its trailing twelve-month revenue stands at only $64 million, resulting in a price-to-sales ratio exceeding 70, indicating a high valuation by conventional standards, warranting caution from investors.
- Market Competition: Although NuScale is the only U.S. company with an NRC-approved SMR design, it faces competition from emerging nuclear startups like Oklo and Nano Nuclear Energy, which are also vying to become the primary power source for artificial intelligence.
- Investment Risks: Given NuScale's current cash burn and losses, investors considering a $500 investment should be prepared for volatility, even though the company holds long-term potential to meet surging electricity demands.
See More
NuScale Power Innovates with Small Modular Reactors
- Small Modular Reactor Design: NuScale Power focuses on developing small modular reactors aimed at reducing construction costs through factory production, although commercial deployment has yet to be realized, indicating the potential value of its technology.
- Market Demand Opportunity: The increasing demand for 24/7 electricity from data centers positions small modular reactors (SMRs) as a viable solution, with NuScale leading the U.S. market as a potential power supplier for high-energy sectors like AI.
- Financial Condition Challenges: Despite a market cap of $4.5 billion, NuScale's trailing 12-month revenue stands at only $64 million, resulting in a price-to-sales ratio exceeding 70, highlighting significant challenges in profitability.
- Investment Risk Advisory: For investors willing to endure volatility, NuScale may represent a long-term growth opportunity, but the company must demonstrate its ability to convert designs into actual projects, necessitating careful risk-reward assessment.
See More
NuScale Power Partners with Oak Ridge to Optimize Nuclear Fuel Management
- Partnership Announcement: NuScale Power has partnered with Oak Ridge National Laboratory to leverage an AI-enabled nuclear design framework aimed at optimizing fuel management across multiple reactors at a single site, which is expected to enhance overall fuel efficiency.
- Funding Support: This collaboration is funded by the U.S. Department of Energy’s Gateway for Accelerated Innovation in Nuclear initiative, indicating government support for nuclear innovation, which may provide NuScale with additional R&D resources.
- Modular Reactor Configuration: The project will focus on a 12-module reactor configuration, and by sharing fuel across modules, NuScale aims to achieve fuel efficiencies that surpass those of a single reactor, potentially reducing operational costs.
- Strategic Implications: NuScale CEO John Hopkins stated that this collaboration will open up new opportunities for future nuclear fuel management, further reducing costs and enhancing the company's competitiveness in the nuclear energy market.
See More
NuScale Partners with ORNL to Enhance Nuclear Fuel Management
- Research Collaboration Launched: NuScale has partnered with ORNL, receiving funding from the DOE's GAIN initiative to explore more efficient nuclear fuel management across multiple reactors, aiming to reduce fuel costs and enhance energy utilization efficiency.
- Funding Context: This funding is part of the first round of GAIN vouchers awarded for fiscal year 2026, with NuScale leveraging ORNL's expertise in AI and machine learning to drive innovation in the nuclear sector.
- Multi-Module Architecture Benefits: NuScale's design allows for up to 12 reactors to share a single fuel pool, which is expected to improve overall fuel efficiency beyond what traditional single-reactor plants can achieve, ultimately lowering operational costs.
- Positive Market Reaction: Following the announcement of the partnership, NuScale's stock rose over 6%, reflecting investor optimism about its potential in the nuclear energy sector, despite a 38% decline in stock price over the past year.
See More
NuScale Power Downgraded to Hold Amid Project Delay Concerns
- Rating Downgrade: TD Cowen downgraded NuScale Power from Buy to Hold due to concerns that its first small modular reactor project may be delayed to 2034, resulting in a 6.9% drop in the company's stock on Wednesday.
- Project Update: NuScale's customer Nuclearelectrica is set to make a final investment decision on its Doicesti small modular reactor project this week; while analysts expect the project to move forward, new approval conditions will shift more risk to NuScale, pushing the expected start of operations to 2033 or 2034 from the original target of 2030.
- Financial Impact: The analyst noted that the near-term financial impact on NuScale is limited, but the added performance risk could become more significant if the initial module does not operate as expected, potentially affecting investor confidence in the future.
- Industry Validation: Bianchi believes that other nuclear utilities are using the Doicesti project as a test case, and its success will serve as an important validation point for NuScale's commercial potential, which may influence decisions by other companies in the sector.
See More
U.S. Plans Aggressive Expansion of Nuclear Energy Capacity
- Nuclear Expansion Goals: The U.S. Department of Energy aims to quadruple nuclear energy capacity by 2050 and plans to have 10 large reactors under construction by 2030, reflecting a strong commitment to nuclear energy investment.
- Funding Support: Congress has allocated $3.1 billion in the latest funding bill specifically for small modular reactors (SMRs) and advanced reactor demonstration programs, aimed at fostering nuclear innovation and technological advancement.
- Market Competitive Advantage: NuScale Power is the only company with NRC standard design approval for an SMR, positioning it favorably to compete for federal funding and potentially accelerate commercial deployments with government backing.
- Investment Risk Assessment: While the increase in government funding is a positive sign for the nuclear industry, NuScale's stock has fallen 70%, and its projects are still in early development stages, indicating a high investment risk with several years until commercial operations.
See More
NuScale Power Advances in Small Modular Reactor Design
- Technological Potential: NuScale Power focuses on designing small modular reactors (SMRs), which, despite not being commercially deployed yet, have the potential to meet the 24/7 electricity demands of data centers, particularly in applications related to artificial intelligence.
- Financial Condition: The company currently has a market cap of $4.5 billion, while its trailing twelve-month revenue stands at only $64 million, resulting in a price-to-sales ratio exceeding 70, indicating a high valuation by conventional standards, warranting caution from investors.
- Market Competition: Although NuScale is the only U.S. company with an NRC-approved SMR design, it faces competition from emerging nuclear startups like Oklo and Nano Nuclear Energy, which are also vying to become the primary power source for artificial intelligence.
- Investment Risks: Given NuScale's current cash burn and losses, investors considering a $500 investment should be prepared for volatility, even though the company holds long-term potential to meet surging electricity demands.
See More
NuScale Power Innovates with Small Modular Reactors
- Small Modular Reactor Design: NuScale Power focuses on developing small modular reactors aimed at reducing construction costs through factory production, although commercial deployment has yet to be realized, indicating the potential value of its technology.
- Market Demand Opportunity: The increasing demand for 24/7 electricity from data centers positions small modular reactors (SMRs) as a viable solution, with NuScale leading the U.S. market as a potential power supplier for high-energy sectors like AI.
- Financial Condition Challenges: Despite a market cap of $4.5 billion, NuScale's trailing 12-month revenue stands at only $64 million, resulting in a price-to-sales ratio exceeding 70, highlighting significant challenges in profitability.
- Investment Risk Advisory: For investors willing to endure volatility, NuScale may represent a long-term growth opportunity, but the company must demonstrate its ability to convert designs into actual projects, necessitating careful risk-reward assessment.
See More
NuScale Power Partners with Oak Ridge to Optimize Nuclear Fuel Management
- Partnership Announcement: NuScale Power has partnered with Oak Ridge National Laboratory to leverage an AI-enabled nuclear design framework aimed at optimizing fuel management across multiple reactors at a single site, which is expected to enhance overall fuel efficiency.
- Funding Support: This collaboration is funded by the U.S. Department of Energy’s Gateway for Accelerated Innovation in Nuclear initiative, indicating government support for nuclear innovation, which may provide NuScale with additional R&D resources.
- Modular Reactor Configuration: The project will focus on a 12-module reactor configuration, and by sharing fuel across modules, NuScale aims to achieve fuel efficiencies that surpass those of a single reactor, potentially reducing operational costs.
- Strategic Implications: NuScale CEO John Hopkins stated that this collaboration will open up new opportunities for future nuclear fuel management, further reducing costs and enhancing the company's competitiveness in the nuclear energy market.
See More
NuScale Partners with ORNL to Enhance Nuclear Fuel Management
- Research Collaboration Launched: NuScale has partnered with ORNL, receiving funding from the DOE's GAIN initiative to explore more efficient nuclear fuel management across multiple reactors, aiming to reduce fuel costs and enhance energy utilization efficiency.
- Funding Context: This funding is part of the first round of GAIN vouchers awarded for fiscal year 2026, with NuScale leveraging ORNL's expertise in AI and machine learning to drive innovation in the nuclear sector.
- Multi-Module Architecture Benefits: NuScale's design allows for up to 12 reactors to share a single fuel pool, which is expected to improve overall fuel efficiency beyond what traditional single-reactor plants can achieve, ultimately lowering operational costs.
- Positive Market Reaction: Following the announcement of the partnership, NuScale's stock rose over 6%, reflecting investor optimism about its potential in the nuclear energy sector, despite a 38% decline in stock price over the past year.
See More
NuScale Power Downgraded to Hold Amid Project Delay Concerns
- Rating Downgrade: TD Cowen downgraded NuScale Power from Buy to Hold due to concerns that its first small modular reactor project may be delayed to 2034, resulting in a 6.9% drop in the company's stock on Wednesday.
- Project Update: NuScale's customer Nuclearelectrica is set to make a final investment decision on its Doicesti small modular reactor project this week; while analysts expect the project to move forward, new approval conditions will shift more risk to NuScale, pushing the expected start of operations to 2033 or 2034 from the original target of 2030.
- Financial Impact: The analyst noted that the near-term financial impact on NuScale is limited, but the added performance risk could become more significant if the initial module does not operate as expected, potentially affecting investor confidence in the future.
- Industry Validation: Bianchi believes that other nuclear utilities are using the Doicesti project as a test case, and its success will serve as an important validation point for NuScale's commercial potential, which may influence decisions by other companies in the sector.
See More
U.S. Plans Aggressive Expansion of Nuclear Energy Capacity
- Nuclear Expansion Goals: The U.S. Department of Energy aims to quadruple nuclear energy capacity by 2050 and plans to have 10 large reactors under construction by 2030, reflecting a strong commitment to nuclear energy investment.
- Funding Support: Congress has allocated $3.1 billion in the latest funding bill specifically for small modular reactors (SMRs) and advanced reactor demonstration programs, aimed at fostering nuclear innovation and technological advancement.
- Market Competitive Advantage: NuScale Power is the only company with NRC standard design approval for an SMR, positioning it favorably to compete for federal funding and potentially accelerate commercial deployments with government backing.
- Investment Risk Assessment: While the increase in government funding is a positive sign for the nuclear industry, NuScale's stock has fallen 70%, and its projects are still in early development stages, indicating a high investment risk with several years until commercial operations.
See More
