SMR Should I Buy
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NuScale Power Corp (SMR) is not a strong buy at the moment for a beginner investor with a long-term strategy. The company faces significant financial struggles, insider selling, and ongoing legal challenges, which outweigh the positive sentiment from nuclear sector growth and technical indicators. A hold position is recommended until clearer signs of financial stability and positive momentum emerge.
The technical indicators show mixed signals. The MACD is positive and expanding, suggesting bullish momentum, while the RSI is neutral at 66.183. However, the moving averages are bearish (SMA_200 > SMA_20 > SMA_5), indicating a downward trend. The stock is trading near resistance levels (R1: 11.814), with a pre-market price of 11.67.
The White House's memorandum on deploying nuclear reactors in space by 2028 and on the Moon by 2030 has positively impacted nuclear stocks.
The company remains the only NRC-approved SMR provider, with a 6 GW potential deal with TVA and incremental progress in commercialization projects.
Significant insider selling, with a 5823.23% increase in the last month.
Multiple class-action lawsuits alleging securities fraud and false statements.
Financial performance shows a drastic revenue drop (-94.72% YoY) and negative net income (-32.21% YoY).
Analysts have significantly lowered price targets, reflecting concerns over capital needs, project delays, and cost overruns.
The company's Q4 2025 financials are weak, with revenue dropping by -94.72% YoY to $1.81M, net income falling to -$50.83M (-32.21% YoY), and gross margin declining to -3.37 (-103.70% YoY). EPS improved slightly to -0.8 (+15.94% YoY), but the overall financial health remains poor.
Analysts have lowered price targets significantly, with UBS, RBC Capital, Citi, and others reducing targets to $11.50-$14 from much higher levels. Ratings range from Neutral to Sell, with some cautious optimism about long-term potential but concerns about near-term challenges.
