NuScale Power Is Down 38% This Year: Here's What the Next 5 Years Could Look Like
2026-07-25 21:05
•Brett Schafer •The Motley Fool
••••• •• Axe Capital view
Why NuScale Power’s Nuclear Bet Looks Risky for Now
NuScale’s approved small modular reactors face long waits and heavy costs, making it a tough play for South African investors.
NuScale Power’s 38% drop this year says a lot about the challenges in nuclear energy investments today. Even with regulatory clearance from the US Nuclear Regulatory Commission and a fat contract from the Tennessee Valley Authority, revenue won’t kick in until 2030 at the earliest. That’s a long dry spell while burning through $750 million in free cash flow. For South African investors, the link is indirect—but the USD/ZAR adds context. The rand's sensitivity to global risk means the cost of funding such long-term projects today is high. This isn’t a quick AI data center boom play, where tech stocks get their glow. Instead, NuScale is a high-risk infrastructure bet where patience and deep pockets matter most. If the US energy policy shifts or tech moves faster on alternatives, NuScale could be further pressured. For investors focused on the JSE, Sasol and AngloGold Ashanti hold clearer energy and dollar-hedged value now. this is just my opinion and not financial advice
Avoid NuScale as a direct play. Instead, focus on Sasol for energy exposure and watch USD/ZAR for funding cost signals that might affect big infrastructure stocks.
- USD/ZAR
- Sasol
- Long project timelines delay revenue generation
- US policy shifts or cheaper tech alternatives could undermine nuclear adoption
6/10
NuScale Power's stock has declined 38% in 2026 despite having the only NRC-approved small modular reactor design. While the company has secured partnerships and contracts (including 6 gigawatts from Tennessee Valley Authority), its projects won't generate revenue until 2030, missing the current AI data center boom. With negative free cash flow of $750 million and negligible revenue, the stock faces significant headwinds.
This article was originally published by The Motley Fool and has been adapted here for Axe Capital Trading News.
Publisher: The Motley Fool
Author: Brett Schafer
Categories: Equities, Earnings, Technology, AI, Semiconductors
Tickers: SMR, CEG
Sentiment: Negative - Despite having regulatory approval and major contracts, the company faces severe near-term challenges: negative free cash flow of $750 million, negligible revenue, delayed project timelines (no revenue until 2030), and inability to capitalize on the current AI data center boom. The stock has declined 38% year-to-date and is expected to face further downside pressure. Mentioned only in a comparative headline without substantive analysis in the main article content.
Keywords: nuclear energy, small modular reactors, AI data centers, NRC approval, cash burn, stock volatility
Insights:
- SMR: Negative: Despite having regulatory approval and major contracts, the company faces severe near-term challenges: negative free cash flow of $750 million, negligible revenue, delayed project timelines (no revenue until 2030), and inability to capitalize on the current AI data center boom. The stock has declined 38% year-to-date and is expected to face further downside pressure.
- CEG: Neutral: Mentioned only in a comparative headline without substantive analysis in the main article content.