Shares of NuScale Power (SMR 2.39%) soared again this week, up 12.9% as of market close on Friday, June 13, according to data from S&P Global Market Intelligence. The nuclear energy start-up now has a market cap of $11 billion and zero revenue, with the stock up 364% in the last 12 months. Traders are getting optimistic on this group of stocks because of press releases and executive orders from the President of the United States.
Here's why NuScale Power stock was soaring yet again this week.
Riding high on nuclear sentiment
Sentiment around nuclear power has taken a 180-degree turn. With rising demand for electricity because of data centers, artificial intelligence (AI), and electric vehicles, companies and utilities are searching for more clean fuels to provide electricity. Nuclear power is a great option for this.
In order to spur demand, President Trump signed an executive order aimed at boosting nuclear energy capacity in the United States and reducing red tape for regulations. This helped boost NuScale Power stock, which is a pre-revenue company trying to develop and sell nuclear power plant designs that are small modular reactors.
This week, Oklo -- another nuclear energy start-up -- put out a press release about a deal to potentially provide nuclear power at an Air Force base in Alaska, although curiously, this same press release was put out in 2023 with little change. The release was done ahead of a stock offering, and sent shares of Oklo and other nuclear energy peers soaring, including NuScale Power.
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NYSE: SMR
Key Data Points
Should you buy NuScale Power stock?
Nothing much changed about NuScale Power's business this week. In fact, it does not have much of a business to begin with. The company is aiming to build a disruptive small modular nuclear energy design that has been approved by the Nuclear Regulatory Commission (NRC), but no projects are slated to come online until 2030 at the earliest.
Existing contracts in Utah were delayed and eventually altogether cancelled because of cost overruns. This is not a good sign for the viability of NuScale Power's technology, and should have investors wary about investing in the stock. This is a company that does not generate revenue, trading at a market cap of $11 billion. It won't generate any revenue for years.
Smart long-term investors will avoid adding NuScale Power stock to their portfolios.
