NuScale Power Shares Surge 55% on Amazon's Nuclear Energy Push

NuScale Power (NYSE: SMR) shares have experienced a significant surge this week, rising by 55% following Amazon's (NASDAQ: AMZN) announcement of its interest in nuclear energy projects, including small modular reactors (SMRs). This article explores the reasons behind NuScale's stock price increase and the potential implications for the company and the broader nuclear energy sector.

Amazon's announcement on Wednesday, November 1st, 2021, revealed that the tech giant has signed three agreements for nuclear energy projects, supporting the construction of new SMRs. Although Amazon did not name NuScale as being involved in any of these projects, the news sent NuScale's stock soaring due to the potential implications for the SMR market.

NuScale's market position as the only U.S. company with an SMR design license from the Nuclear Regulatory Commission (NRC) has contributed to its stock price surge. This license allows NuScale to develop and deploy its SMR technology, providing a competitive advantage in the market. The Amazon news has further boosted investor confidence in NuScale's potential as a key player in the SMR sector.


The short squeeze phenomenon has also contributed to NuScale's stock price surge. As of the end of September, 24% of NuScale's stock was sold short. The Amazon news triggered a short squeeze, as investors rushed to cover their bets, leading to a significant increase in NuScale's stock price.


Despite the recent stock price increase, NuScale Power faces several potential hurdles and challenges in the SMR market. The company has had a significant setback in the past, having to cancel its first SMR project planned for a lab in Idaho. Additionally, the SMR market is highly competitive, and there are still many hurdles standing in the way of widespread adoption of SMRs. NuScale's stock is likely to remain volatile and move on broader news about SMRs, given that it is a development-stage company with barely any revenue to speak of.

In conclusion, Amazon's interest in nuclear energy has positively impacted NuScale Power's market position, leading to a 55% surge in its stock price. However, NuScale still faces several challenges in the SMR market, and investors should remain cautious about the company's long-term prospects. The SMR sector is highly competitive, and NuScale's success will depend on its ability to overcome these hurdles and capitalize on the growing interest in nuclear energy.