NuScale Power (SMR) — Buy Strategy & Analysis
NuScale Power (SMR) — Buy Strategy & Analysis
Date: 2026-03-06
Current Situation
| Metric | Value |
|---|---|
| Price | $11.70 |
| 52-Week High | $57.42 (Oct 15, 2025) |
| 52-Week Low | $11.08 |
| Distance from High | -79.6% |
| Distance from Low | +5.6% |
| Market Cap | $3.73B |
| Shares Outstanding | ~319M (estimated) |
| Beta | 2.25 |
| Forward P/E | -29.54 (not profitable) |
| 50-day MA | $16.51 |
| 200-day MA | $30.53 |
| Cash on Hand | $1.3B (Dec 31, 2025) |
SMR is trading near its 52-week low, down ~80% from the October 2025 peak. The stock is deep below both its 50-day and 200-day moving averages.
Price History — The Collapse
| Period | Event | Price Action |
|---|---|---|
| May-Oct 2025 | AI/nuclear hype cycle | $17 → $57.42 (+238%) |
| Oct 15-22, 2025 | Post-peak selloff | $57.42 → $34.72 (-40%) |
| Nov 3-7, 2025 | ENTRA1 scandal breaks | $40.83 → $30.34 (-26%) |
| Nov 7-21, 2025 | Continued ENTRA1 fallout | $30.34 → $18.60 (-39%) |
| Dec 2025 | Brief bounce, then decline | $18-22 range |
| Jan 2026 | Fluor share sale begins | $20.51 → $17.48 |
| Feb 2026 | Fluor dumps 71M shares, lawsuit filed | $17.53 → $12.85 |
| Mar 1-6, 2026 | Hormuz crisis + continued selling | $13.05 → $11.70 |
The decline has been driven by specific negative catalysts, not just market conditions. This matters for any buy thesis — you need to assess whether the catalysts are temporary or structural.
What Went Wrong
1. ENTRA1 Partnership Disaster
On November 6, 2025, NuScale disclosed that:
- General & administrative expenses exploded from $17M to $519M in Q3 2025
- $495M was paid to ENTRA1 Energy under a "Partnership Milestone Agreement"
- NuScale admitted ENTRA1 had never built, financed, or operated any significant project
- ENTRA1 was supposed to be their "exclusive global partner" for constructing SMR plants
Stock dropped 12.4% in two days. A securities class action was filed (deadline: April 20, 2026).
2. Fluor Corporation Exit
- Fluor (NuScale's original backer) sold 71M shares for $1.35B
- Still holds 40M shares (~13.3% of outstanding) being sold through Q2 2026
- This creates persistent selling pressure for months
- When your largest shareholder is dumping, it signals something
3. Massive Dilution
- End of 2024: ~122.8M shares outstanding
- Fluor Class B → Class A conversion: ~111M shares
- ATM offering Q4 2025: 39.3M shares ($750M raised)
- Estimated current total: ~319M shares
- Shares nearly tripled in one year
4. No Firm Contracts
- CFPP (their first project) was cancelled in November 2023 due to cost overruns ($5.3B → $9.4B)
- TVA partnership announced but no firm construction commitment
- Citi downgraded to Sell citing "limited visibility" on TVA contract
- Revenue actually declining: $37M (2024) → $31.5M (2025)
What's Still Standing
1. Only NRC-Approved SMR Design
NuScale's VOYGR is the only small modular reactor design with full NRC approval (January 2023). This is a genuine competitive moat. Competitors (OKLO, X-energy, Kairos) are years behind on the regulatory path.
2. $1.3B Cash Position
At the current operating burn rate of ~$172-200M/year (excluding the ENTRA1 one-time), NuScale has approximately 6-7 years of runway. They are not facing imminent dilution for survival. They can afford to wait for contracts.
3. Secular Tailwinds
- AI data center power demand is real and growing
- Hormuz crisis reinforces energy security / nuclear argument
- US government supportive of nuclear (DOE funding, TVA interest)
- US-Japan Framework Agreement ($25B potential for SMR deployment via NuScale tech)
4. TVA Pipeline
Partnership to deploy up to 6GW across seven states. If even one project gets a firm order, it changes the narrative entirely.
Valuation Floor Analysis
| Approach | Value/Share | Notes |
|---|---|---|
| Cash per share | $4.08 | $1.3B ÷ 319M shares |
| Cash + IP value | ~$6-8 | Assigning $600M-$1.2B for only NRC-approved SMR design |
| Enterprise value | $2.43B | Market cap minus cash |
| EV / Revenue | 77x | On $31.5M FY2025 revenue — absurd by any metric |
The cash floor at ~$4/share provides a rough downside estimate in a liquidation scenario. The NRC approval has genuine value but is hard to price without contracts.
There is no reasonable fundamental valuation for this stock at current prices. It trades entirely on narrative and optionality. At $11.70, the market is pricing ~$7.60/share of option value above cash — essentially a bet that NuScale will eventually land contracts.
Financials
Income Statement (FY2024, most recent annual)
| Item | Amount |
|---|---|
| Revenue | $37.0M |
| Cost of Revenue | $4.9M |
| Gross Profit | $32.1M |
| R&D | $46.8M |
| SG&A | $75.9M |
| Operating Loss | -$138.7M |
| Net Loss | -$136.6M |
| EPS | -$1.47 |
FY2025 (Reported Feb 26, 2026)
| Item | Amount |
|---|---|
| Revenue | $31.5M (declining) |
| G&A Expenses | $609.8M (incl. $507.4M ENTRA1 payment) |
| Cash Position | $1.3B |
Cash Flow
| Year | Operating CF | Free Cash Flow |
|---|---|---|
| 2024 | -$108.7M | -$108.7M |
| 2023 | -$183.3M | -$185.0M |
| 2022 | -$148.6M | -$150.9M |
Cash burn has been improving, though 2025 will look worse due to the ENTRA1 payment.
Technical Analysis
Current Structure
- Trend: Strong downtrend on all timeframes
- Support: $11.08 (52-week low, tested approaching now)
- Next support: $11.08 is the line — below that, there's no historical support until the $8-9 range (pre-hype levels from early 2025)
- Resistance: $13.00-13.50 (recent consolidation), $14.50 (Feb support-turned-resistance), $16.50 (50-day MA)
- Volume: Declining (14M today vs 24M average) — could signal selling exhaustion or loss of interest
Key Levels to Watch
| Level | Significance |
|---|---|
| $11.08 | 52-week low — break below is very bearish |
| $13.00-13.50 | Immediate resistance, needs to reclaim |
| $16.50 | 50-day MA — a close above signals trend change |
| $20.00 | Psychological level, pre-Fluor dump |
| $30.50 | 200-day MA — bull market confirmation |
Risk Assessment
Severe Risks
- Fluor selling continues through Q2 2026. 40M shares at current prices ≈ $468M of supply. This is a structural headwind.
- Securities class action (deadline April 20). Outcome uncertain. Even if it settles, it validates concerns about management judgment.
- ENTRA1 $495M payment. Management credibility is damaged. They paid half a billion dollars to a partner with no track record. This raises questions about governance.
- No revenue path. Pre-revenue companies with declining revenue and no firm contracts can go to zero. The NRC approval is valuable but worthless without commercial deployment.
- Further dilution possible. They have $1.3B cash now, but if they need more, they'll issue more shares.
Moderate Risks
- Nuclear sentiment reversal. If AI power demand narrative fades or gas prices fall, nuclear urgency drops.
- Regulatory changes. NRC approval is design-specific; site approvals still required per project.
- Competition. Other SMR designs (GE-Hitachi BWRX-300, X-energy Xe-100) progressing.
What Could Go Right
- TVA firm order — would reprice the stock significantly
- Japan framework money materializes — $25B is transformative
- Fluor finishes selling — removes structural overhang by Q2 2026
- Class action settles cheaply — removes uncertainty
- Another utility contract — validates commercial viability
What I Would Monitor
| Signal | Interpretation |
|---|---|
| Fluor 13D filing showing 0 shares | Selling pressure removed — bullish |
| Class action settlement terms | If cheap (<$50M), management gets off easy — neutral/bullish |
| TVA site selection announcement | Pre-contract milestone — bullish |
| Quarterly cash burn >$60M | Accelerating spend without revenue — bearish |
| New ATM offering announced | More dilution incoming — bearish |
| Insider buying | Management putting skin in game — bullish |
| NRC certification for uprated design | Expands addressable market — bullish |
Comparison with BHI (083650.KQ)
Both are nuclear plays, but they are fundamentally different:
| Factor | SMR (NuScale) | BHI (083650.KQ) |
|---|---|---|
| Revenue | $31.5M (declining) | Real revenue, profitable |
| Contracts | None firm | ₩1.54T+ backlog |
| Cash | $1.3B (from dilution) | Operational cash generation |
| Stage | Pre-commercial | Operating manufacturer |
| Institutional flow | Fluor exiting | Institutions accumulating |
| Lawsuit | Active class action | None |
| Valuation basis | Narrative/optionality | Earnings/contracts |
BHI is a nuclear thesis backed by real business. SMR is a nuclear thesis backed by an NRC approval and cash.
Summary
SMR at $11.70 is a damaged stock with legitimate long-term optionality. The NRC approval is real, the cash runway is real, and the secular tailwinds for nuclear are real. But the near-term picture is ugly: Fluor dumping shares through Q2, an active securities lawsuit, management credibility damaged by the ENTRA1 debacle, and no firm contracts.
The staged buy approach protects you from catching a falling knife while still getting exposure near the lows. The most important gate is Fluor finishing its sales — until that overhang clears, the stock faces persistent supply regardless of any positive catalyst.
If you're adding to an existing losing position, be honest about total exposure. This is speculative. The cash floor (~$4/share) means it probably doesn't go to zero, but it could easily trade $8-9 before any recovery.
Sources: Yahoo Finance, NuScale Power press releases, SEC filings, Motley Fool, Seeking Alpha, Nuclear Engineering International
Buy Strategy
Context: You already hold a small position at a loss. You want to add. The stock is near its 52-week low with severe headwinds but legitimate long-term optionality.
Approach: Staged Dollar-Cost Average with Catalyst Gates
This is a high-risk speculative position. Do not allocate more than you can afford to lose entirely.
Tranche 1: Near Current Levels ($11-12)
- Size: $500
- Suggested order: Limit buy $11.25, ~44 shares, good for 1 week
- Rationale: Near 52-week low, much bad news priced in. $11.25 sits just above the 52-week low ($11.08), which acts as a magnet. Daily lows are trending toward it at ~$0.15-0.20/day. If it never fills, the stock found support — better outcome for existing position.
- Risk: Fluor still selling, could break $11.08
Recent daily lows supporting the $11.25 target:
| Date | Low | Close |
|---|---|---|
| Mar 2 | $12.27 | $13.05 |
| Mar 3 | $11.74 | $12.53 |
| Mar 4 | $12.50 | $12.54 |
| Mar 5 | $11.75 | $12.18 |
| Mar 6 | $11.61 | $11.70 |
- More aggressive fill: $11.50
- Greedier: $11.00 (right at 52-week low)
Tranche 2: After Fluor Selling Completes (expected Q2 2026)
- Size: 25% of intended additional allocation
- Trigger: Fluor files showing zero remaining shares, or public announcement
- Rationale: Removes largest structural selling pressure. This is the most important catalyst gate.
- Expected price range: Unknown — could be higher or lower than today depending on market
Tranche 3: On First Firm Contract
- Size: 25% of intended additional allocation
- Trigger: TVA firm construction commitment, or any other binding contract with construction timeline
- Rationale: Transforms SMR from "story stock" to "pipeline stock." You will likely pay more per share but with dramatically less risk.
Tranche 4: Reserve
- Size: 25% of intended additional allocation
- Use: Opportunistic — either on a sharp selloff (break below $11.08) or on a second contract announcement
- Rationale: Keeps powder dry for either a capitulation buy or momentum confirmation
Alternative: Aggressive Bottom-Fish
If the stock breaks below $11.08:
- Watch for $8-9 range (pre-hype levels, April 2025)
- Consider Tranche 1 at those levels instead
- A break below $11.08 with volume means the market doesn't believe in the current floor
Stop-Loss Consideration
Given this is speculative:
- Hard stop: Consider a mental stop at $6-7 (approaching cash value per share). If it trades there, the market is pricing potential cash burn / further ENTRA1 losses.
- No stop: If you view this as pure long-term optionality and the total allocation is money you can lose, no stop may be appropriate — the cash runway gives you 6-7 years.