NuScale Power Corporation (NYSE: SMR) experienced a significant decline on Friday, with shares falling 12.5% to close at $10.50. The stock continued to edge lower in after-hours trading, settling at $10.37. The selloff occurred amid a broad market downturn that hit growth stocks particularly hard, with the S&P 500 sliding 2.63% and the Nasdaq Composite dropping 4.18%.
The downturn was not isolated to NuScale. Other nuclear-focused companies also felt the pressure, with Oklo Inc. and Nano Nuclear Energy Inc. losing approximately 11% and 10%, respectively. This broad-based decline suggests that the selloff may be more about a general risk-off sentiment in speculative sectors rather than company-specific issues.
Board Appointments Fail to Inspire
Last week, NuScale announced the election of Stuart A. Harshaw and Dale E. Klein to its board of directors at the annual meeting. Harshaw brings experience in industrial projects, while Klein previously chaired the U.S. Nuclear Regulatory Commission. CEO John Hopkins expressed confidence that both individuals will provide tremendous value and support the company's global deployment efforts. However, the market reaction suggests that board changes alone are insufficient to offset concerns about the company's operational progress.
Weak Q1 Financial Results
NuScale's first-quarter financial results, reported earlier, revealed revenue of just $565,000 and a net loss of $46.7 million. The company ended the quarter with $1.0 billion in cash, cash equivalents, and investments. While the cash position provides a buffer, the lack of meaningful revenue and ongoing losses highlight the challenges the company faces in transitioning from a development-stage company to a revenue-generating enterprise. Hopkins stated that the company is building the infrastructure required for this pivotal moment, but investors are clearly looking for more concrete signs of commercial progress.
Regulatory Milestone Yet to Translate to Contracts
The U.S. Nuclear Regulatory Commission approved NuScale's 77-megawatt small modular reactor (SMR) design in 2025, a significant regulatory milestone. However, the company has yet to secure a firm customer contract. Hopkins told Reuters that NuScale could have an SMR operational by the end of the decade if a customer steps forward, but the timing is ultimately in the customer's hands. The absence of new contract announcements continues to weigh on the stock, as the market awaits tangible commercial traction.
Analyst Views Remain Mixed
Analyst sentiment on NuScale is divided. According to TipRanks, the average 12-month price target among 14 analysts is $15.67, with estimates ranging from $7 to $25. Bank of America Securities' Dimple Gosai rates the stock a Hold with a $12 target, while Citi's Vikram Bagri rates it a Sell with a $7 target. On the bullish side, Canaccord Genuity's George Gianarikas rates it a Buy with a $25 target. This divergence reflects the uncertainty surrounding the company's ability to convert its regulatory advantage into commercial success.
Market Context and Risks
The broader market selloff on Friday was driven by a risk-off mood that impacted growth and speculative stocks across sectors. For NuScale, the key risks include the need for firm customer contracts, potential project delays, manufacturing hurdles, and questions about whether its SMR modules can compete on price. The company's prior Carbon Free Power Project was canceled in 2023 after costs escalated and municipal buyers withdrew. Until NuScale announces a commercial deal or financing news, the stock is likely to trade based on technical levels, cash reserves, and investor patience for long-duration nuclear projects.
Outlook for the Week Ahead
With U.S. markets closed on Monday for the Juneteenth holiday on June 19, the focus this week will be on whether buyers return after Friday's risk-off action. For NuScale, the immediate catalyst would be any news regarding a commercial contract, partnership, or financing update. In the absence of such news, the stock will likely continue to trade in reaction to broader market sentiment and its ability to hold above Friday's low of $10.15.
