Oklo Stock Is Up More Than 400% This Year. Here's Why I Wouldn't Buy It -- Yet

Sometimes, as an investor, you find a company you love. It's an innovator, or it's working on some very cool technology, or it's got some new way of doing business that's making waves in its industry, but you can't bring yourself to invest in it. Not yet, at least.

Oklo (NYSE: OKLO) is one of those for me. The nuclear stock has shot up 426% in 2025 through Dec. 4, and there's a lot to love about it, but there is one very big problem holding me back from buying shares.

Let's start with why I really like it, as well as why I think it is certainly one to watch.

Image source: Getty Images.

A new dawn on the nuclear frontier

Oklo is on the bleeding edge of nuclear technology. For example, its Aurora small modular reactor (SMR) is unlike any of those from current competitors like Rolls-Royce, which has pivoted from cars to water-cooled nuclear reactors. But Oklo's Aurora is a liquid metal cooled fast reactor.

Liquid metal reactors use liquid sodium or lead to cool the reactor, as opposed to water. The exact way they work is fascinating, but outside the scope of this article. The bottom line is that, according to the Department of Energy, these reactors:

• Extract 100 times more energy from the same fuel used in water-cooled reactors.
• Are capable of a 90% reduction in nuclear waste over traditional reactors.
• Are more resistant to meltdown, and therefore safer than water-cooled reactors.
• Can produce three times the power of a comparable water-cooled reactor.

And Oklo's Aurora reactor puts all of that in a relatively small power plant that can produce up to 75MWe of electricity and go as long as 20 years without refueling. The first of these reactors is under construction at the Idaho National Laboratory, which Oklo plans to bring online by the end of 2030.

Even more interesting than that is Oklo's fuel recycling technology. It's also a place where Oklo has little to no competition. There are other SMR companies, but no other nuclear fuel recycling companies in America.

Thus Oklo is the leader in fuel recycling technology in the United States. The company claims that there is enough energy in "spent" fuel rods rotting away in storage at nuclear plants around the U.S. to power the country for over 150 years.

To exploit this energy gold mine, Oklo is building a $1.7 billion nuclear fuel recycling facility in Tennessee. And the company has already won over $15 million in Department of Energy grants for fuel recycling.

For comparison, international competitor Orano in France reported earnings before interest, taxes, depreciation, and amortization (EBITDA) of 2 billion euros in 2024, with a margin of 35.2%. I see no reason Oklo couldn't accomplish that in the United States with its Tennessee plant.

The problem

All that sounds great. What's the catch?

Despite Oklo's incredible technology and potential, it has no operational reactors or fuel recycling plants. It generates no revenue and is entirely dependent upon investor dollars and government contracts. It recorded a net loss of $64.2 million for the first nine months of 2025.

That's not to say it's destitute. Oklo is sitting on cash reserves of $410 million and marketable debt securities of $511.5 million. Additionally, the company's debt is low and manageable, sitting at $40.6 million as of Sept. 30.

And, while Oklo relies on investment and its reserves, it has enough cash to operate for at least another five years at its current burn rate.

The Department of Energy recently selected Oklo for its Advanced Nuclear Fuel Line pilot projects, which will see Oklo build three new fuel fabrication plants. Oklo also signed an agreement with France's Newcleo (which could invest up to $2 billion in Oklo), where the companies will partner to develop advanced fuel fabrication infrastructure.

The lack of revenue makes Oklo a risky bet. But I think the company has serious potential in the long run. So does Wall Street, as the stock is up more than 400% so far this year. And that's all on a company with no revenue, operating at a growing loss, and with none of the usual valuation metrics -- like price-to-earnings or price-to-sales ratios -- that investorsuse to gauge a company's health.

One to watch, wait, and root for

I like Oklo a lot, but consider it highly speculative right now. If its price comes down, it might be worth considering, but right now, the stock seems too expensive for a company with no revenue (and that will likely have none until 2030 at the earliest).

Still, Oklo's technology is pushing the frontiers of nuclear science, and I remain very optimistic about it in the long term. For now, though, that innovation comes at a steep price for investors.

This is definitely a company to keep an eye on, and one that I expect will see a serious share price pop after the first quarter in which it reports revenue, and an even bigger one the quarter it achieves profitability. The nuclear fuel recycling industry could be worth as much as $4.7 billion by the end of the decade, according to some estimates, and the SMR market could be worth $7 billion by 2030 as well.

Until then, I'm rooting for Oklo. Its fuel recycling and advanced reactors could solve some of the most pressing energy and environmental problems we face today. I hope it's as good at avoiding financial meltdown as its liquid metal reactors are at avoiding nuclear meltdown.

James Hires has no positions in the stocks mentioned. The Motley Fool recommends Rolls-Royce Plc. The Motley Fool has a disclosure policy.