Which Nuclear Energy Stock, Oklo or NuScale, Offers Better Gains?

Shares of Oklo Inc. OKLO and NuScale Power Corporation SMR skyrocketed 195.7% and 118.9% this year due to political support for nuclear energy. What factors are driving this momentum, and which stock offers more potential gains?  Let’s explore –  

Reasons to Be Bullish on Oklo 

Oklo, a nuclear energy start-up, announced recently that it received a notice of intent to award (NOITA) for an Alaska project. Oklo was chosen by the Department of Defense (DoD) to provide nuclear reactor technology for Eielson Air Force Base in Alaska.  

Oklo’s CEO, Jacob DeWitte, said that the contract with the branch of the U.S. military “reflects continued confidence in Oklo’s ability to deliver clean and secure energy solutions for mission-critical infrastructure.” 

Oklo will create a nuclear facility for power and heat supply to the base, operating independently from the electrical grid, which is ideal for remote areas. This marks a significant milestone for Oklo as it secures an early client from the military, boosting confidence in its unique nuclear technology.  

Lest we forget that President Donald Trump’s executive order to accelerate new nuclear power reactor deployment in the United States and reform the Nuclear Regulatory Commission (NRC) has been a boon for Oklo. This is because the Eielson-Oklo deal, announced in August 2023, was canceled a month later due to regulatory complications. 

Reasons to Be Bullish on NuScale Power 

NuScale Power, known for providing innovative advanced small modular reactor (SMR) technology, also received support from Trump’s executive order to increase nuclear energy production in the United States by easing regulations and expediting power plant licenses.  

The Trump administration has prioritized SMRs for their cost-effectiveness, flexibility, and quick construction. Such a special focus has benefited NuScale Power as its NuScale Power Module is the only SMR to get design approval from NRC. 

The NRC’s approval of NuScale SMR technology boosts ENTRA1 Energy’s ability to deliver energy swiftly through ENTRA1 Energy Plants, using NuScale SMR technology. ENTRA1 Energy is NuScale’s development platform for independent power plants. 

It’s worth mentioning that NuScale Power’s first-quarter exceeded expectations, positioning the company for strong future performance amid recent positive developments. 

OKLO Vs. SMR: Which Nuclear Energy Stock Has Higher Potential Gains? 

DoD’s interest in Oklo benefits its shares, while NuScale Power stands to gain from being the sole NRC-approved SMR technology company. Having said that, Oklo plans to introduce its first SMR by late 2027 or early 2028, with both companies set to profit from increasing demand for SMRs due to the need for clean energy solutions.  

Oklo and NuScale Power also stand to benefit from Trump’s executive orders supporting the industry and fueling the AI revolution, with both stocks displaying bullish chart patterns. Shares of Oklo and NuScale Power are trading above both the short-term 50-day moving average (DMA) and long-term 200 DMA, indicating a positive trend. 

Technical Indicator & Overlays – OKLO 

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Technical Indicator & Overlays – SMR

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Therefore, it’s challenging to determine which stock might offer better gains. NuScale Power, older than Oklo, has shown consistent returns with limited risk. Whereas Oklo, through its recent share issues for fundraising, aims for business growth and expansion, leading to a higher expected earnings growth this quarter at 97.7% compared to NuScale Power at 64.5%. 

Each of the stocks has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here. 

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

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