NuScale Power's Small Reactor Aims for Carbon-Free Energy Transition
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 day ago
0mins
Should l Buy SMR?
Source: Fool
- Significant Market Potential: NuScale Power's small light-water reactor is viewed as a crucial solution for addressing carbon neutrality challenges, with small modular reactors (SMRs) expected to become a key energy source over the next three decades, potentially reaching a market size of $10 trillion.
- Clear Regulatory Advantage: NuScale is the only U.S. company with an SMR design approved by the Nuclear Regulatory Commission (NRC), and while competitors like Oklo are rapidly approaching regulatory approval, NuScale's head start positions it strongly in the emerging nuclear market.
- Uncertain Revenue Outlook: Despite its regulatory edge, NuScale currently has negligible SMR revenue, and it may take several years before it achieves commercialization profitability, with its stock trading about 75% lower than its all-time high, reflecting market concerns about its future earnings potential.
- Analyst Optimism: Despite execution risks, the average analyst price target is $17, implying nearly 30% upside from current prices, particularly as demand for artificial intelligence infrastructure grows, making NuScale an attractive investment opportunity in the energy 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: 12.580
Low
18.50
Averages
32.77
High
60.00
Current: 12.580
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.
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- Significant Revenue Decline: NuScale Power reported Q1 revenue of $0.57 million, a staggering 96% drop from $13.38 million in the same quarter of 2025, significantly below the $5.57 million consensus estimate, indicating a sharp decline in revenue from technology licensing agreements that could impact investor confidence.
- Market Competitive Advantage: CEO John Hopkins emphasized that NuScale is the only small modular reactor developer with U.S. Nuclear Regulatory Commission approval, leveraging the use of low-enriched uranium fuel, which provides a significant regulatory and commercialization edge amid rising energy demands.
- Strong Supply Chain Network: NuScale has signed agreements with 37 key suppliers to support production readiness by 2026, and with a liquidity position of $1 billion, the company is positioned years ahead of competitors, ensuring it can meet future market demands effectively.
- Retail Investor Optimism: Despite SMR stock declining nearly 23% this year, retail sentiment remains bullish on social media, with investors believing the company is still in its early stages and expecting tangible results within the next 18 months, reflecting confidence in its long-term potential.
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- Fluor's Stake Sale: Fluor, an early investor in NuScale with a $570 million investment, sold its entire stake for $2.43 billion amid rising stock prices, which has contributed to significant downward pressure on NuScale's stock, now nearly 80% below its 52-week high.
- Significant Technological Edge: NuScale is the only company with standard design approval from the U.S. Nuclear Regulatory Commission (NRC) for its 77-megawatt electric module, providing a first-mover advantage that could attract more customers, especially data center operators seeking reliable power.
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- Growing Nuclear Demand: Cameco estimates that nuclear power demand will surge in the 2030s, leading to uranium supply shortages, with 72 new reactors currently under construction and older ones being restarted or having their lifespans extended, thus revitalizing the nuclear sector.
- Potential of Small Modular Reactors: NuScale and Oklo are developing small modular reactors, and while neither has connected to the grid and both are currently losing money, successful technology adoption could provide long-term growth opportunities, albeit with significant risks.
- Cameco's Market Advantage: As a uranium fuel producer, Cameco anticipates rising uranium prices due to supply-demand dynamics, which would significantly boost its profits, and its long-standing history in the industry positions it as a reliable fuel supplier to nuclear power plants.
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- Significant Revenue Decline: NuScale Power reported Q1 revenue of $0.57 million, a staggering 96% drop from $13.38 million in the same quarter of 2025, significantly below the $5.57 million consensus estimate, indicating a sharp decline in revenue from technology licensing agreements that could impact investor confidence.
- Market Competitive Advantage: CEO John Hopkins emphasized that NuScale is the only small modular reactor developer with U.S. Nuclear Regulatory Commission approval, leveraging the use of low-enriched uranium fuel, which provides a significant regulatory and commercialization edge amid rising energy demands.
- Strong Supply Chain Network: NuScale has signed agreements with 37 key suppliers to support production readiness by 2026, and with a liquidity position of $1 billion, the company is positioned years ahead of competitors, ensuring it can meet future market demands effectively.
- Retail Investor Optimism: Despite SMR stock declining nearly 23% this year, retail sentiment remains bullish on social media, with investors believing the company is still in its early stages and expecting tangible results within the next 18 months, reflecting confidence in its long-term potential.
See More
Small Modular Reactors Drive Nuclear Energy Resurgence
- Surge in Nuclear Demand: As energy demand from data centers grows rapidly, nuclear energy is experiencing a resurgence, particularly with promising technologies like small modular reactors (SMRs) from NuScale Power, which could revolutionize the industry.
- Fluor's Stake Sale: Fluor, an early investor in NuScale with a $570 million investment, sold its entire stake for $2.43 billion amid rising stock prices, which has contributed to significant downward pressure on NuScale's stock, now nearly 80% below its 52-week high.
- Significant Technological Edge: NuScale is the only company with standard design approval from the U.S. Nuclear Regulatory Commission (NRC) for its 77-megawatt electric module, providing a first-mover advantage that could attract more customers, especially data center operators seeking reliable power.
- Slow Project Progress: Despite the promising technology, NuScale's project in Romania is years away from commercialization, and the lack of additional firm commitments raises concerns among investors about the company's stability and profitability moving forward.
See More
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- Robotaxi Market Potential: Ark Invest CEO Cathie Wood predicts that the robotaxi market could reach a staggering $10 trillion globally, with Tesla expected to dominate due to its capital access and infrastructure, while Rivian, with its smaller market cap and a $1.25 billion order from Uber, shows greater upside potential.
- Nuclear Energy Opportunity: Analysts at Bank of America believe that the nuclear energy market could also reach $10 trillion, particularly with the commercialization of small modular reactor (SMR) technology, which offers enhanced safety and lower carbon emissions; NuScale Power is the only company approved to build SMRs in the U.S., positioning it at the forefront of this market.
- SpaceX IPO Outlook: SpaceX is expected to go public next month with a valuation between $1.5 trillion and $2 trillion, aiming to raise up to $75 billion, which will create trillion-dollar opportunities in global satellite communication and space data centers, although detailed financials are still pending.
- High-Risk, High-Reward Investment: With a market cap of less than $5 billion, NuScale Power presents a high-risk, high-reward investment opportunity despite facing project cancellations, especially in the context of surging electricity demand, making it a compelling choice for investors seeking growth in the energy sector.
See More
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- Growing Nuclear Demand: Cameco estimates that with 72 new reactors under construction and older ones being restarted, nuclear power demand will surge in the 2030s, potentially leading to uranium supply shortages that could drive prices up and enhance the company's profits.
- Potential of Small Modular Reactors: NuScale and Oklo are developing small modular reactors, and while neither has connected a reactor to the grid yet, successful technology deployment could provide long-term growth opportunities for both companies, despite their current financial losses.
- Cameco's Market Position: As a reliable global supplier of nuclear fuel, Cameco's stock has surged over 300% in the past three years, reflecting its strong performance in the nuclear market, with expectations of benefiting from rising uranium prices in the future.
- Brookfield's Steady Income: Brookfield Renewable Partners, through its 50% stake in Westinghouse, generates consistent cash flow that supports a 4.5% dividend yield, making it an ideal choice for conservative investors, especially amid rising nuclear energy demand.
See More
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- Growing Nuclear Demand: Cameco estimates that nuclear power demand will surge by the 2030s, with 72 new reactors under construction and older ones being restarted or having their lifespans extended, leading to a projected uranium supply shortage that will boost prices and enhance company profits.
- Diverse Investment Options: For conservative investors, Cameco and Brookfield Renewable are ideal choices for entering the nuclear sector, while more aggressive investors may prefer NuScale and Oklo, despite the latter's lack of commercial reactors and high-risk profile.
- Synergistic Benefits from Westinghouse: Cameco owns 50% of Westinghouse, which designs and builds reactors, providing a stable revenue stream that smooths out Cameco's financial results, while Brookfield Renewable benefits from the cash flow generated by this partnership.
- Nuclear Renaissance Driven by Power Demand: Factors such as electric vehicles, artificial intelligence, and data centers are increasing electricity demand, positioning nuclear energy as a viable solution, with Cameco and Brookfield Renewable offering relatively low-risk investment opportunities as established players in the industry.
See More
Nuclear Power Industry Outlook and Investment Opportunities
- Growing Nuclear Demand: Cameco estimates that nuclear power demand will surge in the 2030s, leading to uranium supply shortages, with 72 new reactors currently under construction and older ones being restarted or having their lifespans extended, thus revitalizing the nuclear sector.
- Potential of Small Modular Reactors: NuScale and Oklo are developing small modular reactors, and while neither has connected to the grid and both are currently losing money, successful technology adoption could provide long-term growth opportunities, albeit with significant risks.
- Cameco's Market Advantage: As a uranium fuel producer, Cameco anticipates rising uranium prices due to supply-demand dynamics, which would significantly boost its profits, and its long-standing history in the industry positions it as a reliable fuel supplier to nuclear power plants.
- Conservative Investment Option: For risk-averse investors, Brookfield Renewable offers a lower-risk income option, benefiting from stable cash flow through its 50% stake in Westinghouse, making it suitable for those seeking dividends.
See More
