NuScale Power has a unique business capable of big growth.
NuScale Power (SMR 1.81%) has a fascinating history. Founded in 2007, the company’s mission was to create the world’s first small modular nuclear reactor that would actually see real-world adoption. In 2011, the company received a huge boost when Fluor (FLR 1.89%) purchased a majority stake. Fluor would go on to invest hundreds of millions of dollars in the project, retaining its majority stake to this day.
In 2022, NuScale went public by merging with a special purpose acquisition company, giving everyday investors a chance to invest in the potential of this emerging technology.
Since 2024, shares of NuScale have soared by over 1,000%. Yet the company’s market capitalization remains at just $10 billion. If you’re looking for stocks that can make you a millionaire, there are two obvious reasons to give NuScale strong consideration.
Small-scale nuclear power could be a gigantic market
The world is thirsty for new forms of energy. Global populations remain on the rise, while a burgeoning middle class in several major developing countries is causing electricity demand to spike throughout many parts of the world. Throw in rising demand for renewable energy, and the result is a very favorable environment for emerging technologies like small-scale nuclear.
Small nuclear reactors, the acronym of which influenced NuScale’s ticker choice, are essentially compact nuclear power plants that can be built off-site and then shipped to wherever they are needed. The relatively small size of these reactors means that they don’t produce as much power as a traditional nuclear power plant, but they are significantly cheaper to build on a per-unit basis, can be much simpler to run, and are easily scalable.
At one point, many analysts believed there would never be a nuclear plant built on U.S. soil ever again. Regulatory barriers, citizens’ fears, and high costs plagued most efforts to get new nuclear power online. Rising demand for renewable power has changed that narrative, however, and now the U.S. government believes the country’s nuclear generation will triple by 2050. Globally, demand is expected to rise by similar rates, with the International Energy Agency upping its nuclear growth predictions earlier this month.
Small modular reactors are also being explored to power data centers — critical infrastructure that is powering the massive rise in artificial intelligence technologies. Many AI infrastructure businesses are looking to build out new nuclear facilities to support their growing need for low-carbon power. Small-scale solar could help satisfy this need, especially in cold and remote areas where cooling costs would theoretically be lower, but local power generation is scarce.
All in all, small modular reactors could be a critical tool in meeting the world’s rising energy needs. And as we’ll learn next, NuScale is uniquely positioned to lead in this emerging market.
Image source: Getty Images.
NuScale Power is the clear choice for small-scale nuclear investors
NuScale isn’t the only company pursuing small modular reactors. Companies like Oklo, BWX Technologies, and NANO Nuclear Energy are also investing heavily to bring SMRs to market. Several other public and private entities are also investing in the space in some capacity. But NuScale’s early mover position gives it a notable advantage.
The biggest advantage for NuScale is that it is the only SMR maker in the U.S. that is NRC certified. The Nuclear Regulatory Commission issues certifications that grant formal approval for a nuclear power plant design to be constructed in real-world applications. This approval process can take years to complete, with the reactor meeting strict safety requirements.
NuScale already has a dozen modules in production, meaning that real-world deployments should happen relatively soon. In general, most of NuScale’s competition is one to three years behind when it comes to actual certification and deployment.
To be sure, the SMR market remains very small for now. But recent certifications, growing attention from investors, and rapidly rising energy demand from power-hungry industries like AI suggest a spike in growth is on the way. NuScale’s early mover advantage makes it an obvious first choice for investors.
Just remember, this is an early stage opportunity. NuScale has yet to achieve profitability. Management has diluted shareholders heavily to stay afloat, while also relying on warrants being exercised to bring in extra cash flow. With less than $500 million on the books, NuScale will continue to raise outside capital to fund its growth dreams. But if you’re a believer in modular nuclear power, NuScale remains your top pick.
Ryan Vanzo has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends BWX Technologies. The Motley Fool recommends NuScale Power. The Motley Fool has a disclosure policy.
