SMR Stock Soars 93% in a Month: What Should Investors Do Now?

NuScale Power (SMR) shares have surged 92.8% in the past month, driven by a significant YoY revenue increase to $13.4 million in Q1 2025 and progress in its SMR technology, particularly the FEED Phase 2 project and Romanian power plant agreement. Despite regulatory advancements and partnerships, including potential demand from tech giants seeking sustainable energy for data centers, the company faces challenges including the absence of a firm customer order and supply chain constraints, leading to a projected loss of $0.41 per share for 2025.

Analysis

NuScale Power (SMR) has demonstrated significant top-line growth, with Q1 2025 revenues surging to $13.4 million from $1.4 million year-over-year, primarily driven by its Front-End Engineering and Design (FEED) Phase 2 project and the Technology License Agreement for Romania's RoPower Doicesti power plant. This operational progress, coupled with an improved liquidity position of $521.4 million in cash, cash equivalents, and short-term investments, underpins its transition from research and development to commercialization and has contributed to a 92.8% stock price increase over the past month. Strategic partnerships, including an exclusive agreement with Energy ENTRA1 supporting a project pipeline of over 30 gigawatts and collaborations with Fluor Corporation and Doosan Enerbility for the Romanian project, are central to its global expansion. NuScale maintains a regulatory lead, with U.S. Nuclear Regulatory Commission approval for its 77 MWe module anticipated by July 2025, potentially reinforcing its first-mover advantage in the SMR market slated for 2030 deployment. However, the company faces considerable headwinds: it has yet to secure its first firm customer order, with this expectation now pushed back to late 2025, creating uncertainty around near-term revenue generation and cash flow. Furthermore, a tight nuclear supply chain poses risks to production scalability and could jeopardize the 2030 deployment timeline. Despite these challenges, increasing interest from major technology companies like Meta, Microsoft, Alphabet, and Oracle for powering AI-driven data centers presents a substantial future demand catalyst. Reflecting the current pre-commercialization phase and associated costs, the Zacks Consensus Estimate for 2025 projects a loss of 41 cents per share, a sharp decline from the year-ago quarter's reported earnings of 42 cents.

Key Decisions for Investors

• Given NuScale's significant long-term potential in the SMR market, balanced by the current lack of firm customer orders and supply chain constraints, investors might consider maintaining current positions while closely monitoring progress on securing initial contracts and navigating production bottlenecks.
• Investors should scrutinize upcoming milestones, particularly the U.S. Nuclear Regulatory Commission's decision expected by July 2025 and any announcements regarding firm customer orders by late 2025, as these will be critical validation points for the company's commercialization pathway and ability to generate meaningful cash flow.
• While the pronounced recent stock appreciation and potential future demand from tech giants are positive indicators, the projected 2025 loss per share and significant execution risks associated with scaling production necessitate a thorough risk assessment prior to initiating or increasing exposure.