Is Market Paying Too Much for OKLO's Distant Nuclear Future?

Oklo Inc. (OKLO) has captured headlines with its ambitious Aurora powerhouse plans, but the company remains firmly in the pre-revenue stage. Its commercialization pathway runs directly through the Nuclear Regulatory Commission, where approvals are known to take years. Even under optimistic scenarios, OKLO’s first revenue-generating unit is unlikely before 2027-2028. That leaves investors with a long wait as quarterly losses continue, raising questions about whether enthusiasm can endure such an extended runway.

The challenge is not just time, but execution. Nuclear projects require near-perfect coordination across safety reviews, site preparation, fuel sourcing, and contractor performance. Any delay in licensing or setbacks in construction could stretch OKLO’s already lengthy schedule. History shows nuclear builds often run into overruns and slippages, which can erode market confidence quickly. Meanwhile, peers like NuScale Power (SMR) are already advancing toward deployment milestones, preparing to capture early commercial opportunities that OKLO has yet to reach.

Adding to the competitive backdrop, Rolls-Royce (RYCEY) is aggressively advancing its small modular reactor (“SMR”) program, with support from the UK and Czech governments. Rolls-Royce has argued that its modular design reduces risks and costs compared with some mega-projects. The company has already secured sovereign funding and utility partnerships, while also tying its SMR strategy to meet rising demand from AI data centers. With Rolls-Royce projecting that hundreds of units could be needed globally by 2050, its initiatives underscore how fast-moving competitors may narrow the runway for Oklo’s long-term opportunity set.

The tension becomes clear when looking at market values. OKLO’s market capitalization has now surpassed NuScale’s and stands at roughly 50% higher, even though NuScale is further along in commercializing its technology and moving toward revenue generation. This mismatch highlights the risk embedded in Oklo’s stock: investors are paying for potential that is still years away. Unless the company demonstrates tangible progress toward deployment, its lofty valuation could prove difficult to sustain in a market that often loses patience with long-dated promises.

The Zacks Rundown on OKLO

Shares of Oklo have surged more than 500% so far this year.

From a valuation perspective — in terms of the trailing 12-month price-to-book (P/B) ratio — Oklo is trading at a significant premium compared to the industry average. The company carries a Value Score of F.

See how the Zacks Consensus Estimate for Oklo’s earnings has been revised over the past 60 days.

The stock currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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