NuScale(US:SMR) MarketBeatยท2024-10-03 12:13Core Viewpoint - NuScale Power, a company specializing in Small Modular Reactors (SMRs), has seen its share price increase by nearly 270% in 2024 despite generating only $1 million in revenue last quarter [1][3]. Company Overview - NuScale Power focuses on developing SMRs, which are smaller than traditional nuclear reactors and can theoretically be constructed more quickly [3]. - The company has received approval from the Nuclear Regulatory Commission (NRC) to build its VOYGR-12 power plants, which can consist of up to 12 NuScale Power Modules (NPMs), each generating 50 megawatts of electricity (MWe) [7][8]. Industry Context - Currently, there are few SMRs operational globally, with construction times for large reactors like VOGTLE 3 and 4 in the US exceeding 10 years [4]. - SMRs offer advantages such as reduced energy loss by being built closer to energy demand and the potential for gradual network expansion [5][6]. Challenges Faced - NuScale has encountered significant setbacks, including the termination of an agreement with the Utah Associated Municipal Power Systems (UAMPS) to build its first operational plant due to escalating costs, which rose from $3 billion to $9.3 billion [9][10]. Market Potential - The demand for nuclear energy is expected to grow, particularly for data centers seeking reliable renewable power sources to meet increasing electricity needs [11][12]. - Despite the company's low revenue, the stock price has surged, reflecting optimism about the future of nuclear energy [12]. Valuation Insights - Analysts suggest that NuScale is currently overvalued, with an average price target of $9.69 indicating a potential downside of 22% [13][14]. - The stock is valued at over 43 times its projected sales for the next twelve months, a figure higher than 98% of publicly traded companies [15]. Analyst Ratings - NuScale Power holds a "Moderate Buy" rating among analysts, but there are concerns regarding its valuation and past implementation failures [15][17].