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The stock price of NuScale Power has dipped by around 10% before markets closed on Friday. This movement followed a broader market trend of stock sell-offs as investors brace the potential of a wave of inflation brought by the Trump administration.

I believe in the potential of SMR (Small Modular Reactors) to power the increasing needs to AI applications. NuScale is the market leader of this technology; being the only producer of SMRs that have obtained approval from the Nuclear Regulatory Commission. Whilst the approval currently only covers the 50 megawatt model, the company expects its 77 megawatt counterpart to pass approval in 2025.

However, it is needless to say that Nuscale has faced multiple headwinds this year. Earlier, the Securities and Exchange Commission launched an investigation into Nuscale’s decision to cut 40% of its workforce. In 2023, higher than expected costs meant the company had to cancel the construction of its reactors in Idaho, resulting in negative investor sentiment.

As other large caps begin to integrate SMRs into their existing operations, Nuscale’s stock price will definitely be pumped up. The US Department of Energy has also announced its initiative to offer companies up to $900million to support the development of SMR, which would be significant for NuScale if they can obtain it.

In a Nutshell

I believe NuScale is a great company with good financials. Stock prices are likely to test the $22.50 price level again as it did earlier this week. Upon breaking this mark, investors will hurry to buy the stock. Shares have a long-term bullish outlook of $50.