Small modular reactors (SMRs) are much smaller than conventional nuclear reactors. They're prefabricated and assembled on-site to reduce the time and costs of constructing a nuclear power plant. SMRs don't generate as much power as larger nuclear reactors on their own, but they can be combined in a modular fashion to deploy larger plants.
That flexibility makes them well-suited for remote areas that aren't well-suited for full-size nuclear plants. They're also a good choice for directly powering data centers. The International Energy Agency (IEA) believes investments in SMRs could rise from $5 billion today to over $25 billion in 2030, and eventually increase to a cumulative total of $670 billion by 2050.
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Two companies that could profit from that market's expansion are NuScale Power (SMR +7.60%) and GE Vernova (GEV +1.43%). The former is a pure-play speculative bet on that nascent market, while the latter is a more diversified energy company that is dabbling in SMRs.
Two different approaches to SMRs
NuScale and GE Vernova define SMRs very differently. NuScale's VOYGR SMRs, which generate 77 MWe, are small enough to be transported in segments on trucks. GE Vernova's BWRX-300 SMR generates 300 MWe, making it equivalent to a mid-sized fossil-fuel plant, but it's significantly larger than NuScale's SMR and can't be transported as easily.
NYSE: SMR
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NuScale's VOYGR is the only SMR to have received a full design certification approval from the U.S. Nuclear Regulatory Commission (NRC). GE Vernova's BWRX-300 hasn't been certified by the NRC yet, but it's actively moving through the regulatory pipeline.
NuScale seems to have an edge against GE Vernova with its smaller SMRs and its NRC design certification. Still, it doesn't expect any of its reactors (in Romania and the U.S.) to come online until the early 2030s. GE Vernova aims to deploy its first reactor (in Canada) in 2030.
NYSE: GEV
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Two different business models
NuScale will generate most of its revenue from front-end engineering and design (FEED) studies, licensing fees, and consulting work until it deploys its first SMRs. From 2025 to 2028, analysts expect its revenue from those contracts to surge from $31.5 million to $276.5 million. But it won't break even anytime soon, and it isn't cheap at 55 times this year's sales.
GE Vernova, which was spun off from General Electric (GE +1.43%) in 2024, is a larger, more diversified, and more profitable company. Last year, it generated 55% of its orders from its Power segment, 33% from its Electrification segment, and 13% from its Wind segment.
Its Power and Electrification divisions are growing rapidly to meet the demands of the power-hungry cloud, data center, and AI markets. Those tailwinds are offsetting the slower growth in its Wind business, which faces tougher supply chain and macro headwinds. Less than 3% of its revenue currently comes from the nuclear energy market -- but that business could grow much larger after it deploys its first SMRs.
From 2025 to 2028, analysts expect GE Vernova's revenue and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) to grow at CAGRs of 17% and 60%, respectively. It trades at 5 times this year's sales and 40 times its adjusted EBITDA.
The better buy: GE Vernova
Over the past 12 months, NuScale's stock has plunged 80% because it's burning cash, lacks near-term catalysts, and still doesn't look cheap relative to its growth potential. GE Vernova's stock has surged 50% as more investors embraced it as an AI energy infrastructure play.
Past performance doesn't guarantee future gains, but GE Vernova remains a better buy than NuScale at these levels. Neither of these companies will deploy their SMRs anytime soon, but GE Vernova has much stronger foundations and more irons in the fire than NuScale.
