NuScale Power Plunges 10.6%: Is the SMR Gold Rush Cooling Off?

Summary
• NuScale Power (SMR) surges 8.5% on historic 6 GW SMR deployment with ENTRA1 and TVA
• Intraday price drops 10.6% from $41.06 high to $36.12 low amid valuation concerns
• Analysts at Bank of America initiate coverage with Neutral rating and $36 price target

NuScale Power’s (SMR) volatile intraday swing reflects a collision of bullish partnership news and bearish valuation skepticism. The stock opened at $40.72, surged on ENTRA1’s SMR deployment announcement, then collapsed under profit-taking and analyst caution. With a 15.46% turnover rate and a -162.6 PE ratio, the market is grappling with whether SMR’s 326% annual gain has priced in its long-term potential.

Partnership Hype Meets Valuation Reality Check
NuScale’s 8.5% rally on Wednesday was fueled by ENTRA1’s 6 GW SMR deployment agreement with TVA, positioning it as a key player in the AI-driven energy transition. However, the subsequent 10.6% intraday selloff reflects Bank of America’s Neutral rating and $36 price target, which highlight SMR’s lack of binding contracts and overvaluation. While the TVA partnership validates NuScale’s technology, the market is pricing in skepticism about commercialization timelines and profitability. The stock’s 52W high of $53.5 and 52W low of $7.02 underscore its speculative nature, with short-term momentum clashing against fundamental caution.

Options Playbook: Capitalizing on Volatility and Technicals
• 200-day average: $26.90 (well above current price)
• 30D MA: $40.84 (resistance near $41.06)
• RSI: 58.48 (neutral, not overbought/sold)
• MACD: -1.28 (bearish divergence from signal line)
• Bollinger Bands: $30.19–$43.90 (current price near lower band)

Technical indicators suggest a short-term bearish bias despite long-term bullish trends. The 52W low of $7.02 and -162.6 PE ratio indicate extreme volatility, making options a strategic tool. Two top options from the chain:

• SMR20250912P37 (Put, $37 strike, 9/12 expiry):
- IV: 87.06% (high volatility)
- LVR: 15.08% (moderate leverage)
- Delta: -0.53 (sensitive to price drops)
- Theta: -0.0074 (minimal time decay)
- Gamma: 0.0803 (responsive to price swings)
- Turnover: $3.76M (liquid)
- Payoff (5% downside): $0.85 per contract
- This put option offers high leverage and liquidity for a bearish bet, ideal for capitalizing on a potential breakdown below $37.

• SMR20250912C38.5 (Call, $38.5 strike, 9/12 expiry):
- IV: 80.45% (moderate volatility)
- LVR: 37.70% (aggressive leverage)
- Delta: 0.338 (moderate directional sensitivity)
- Theta: -0.1458 (rapid time decay)
- Gamma: 0.0799 (high sensitivity to price swings)
- Turnover: $2.63M (liquid)
- Payoff (5% downside): $0.00 (out-of-the-money)
- This call offers aggressive leverage for a bullish rebound, but requires a sharp reversal to $38.50 to profit.

Hook: Aggressive bears should target SMR20250912P37 for a breakdown below $37, while bulls may consider SMR20250912C38.5 into a bounce above $38.50.

Backtest NuScale Power Stock Performance

Act Now: SMR at a Crossroads—Volatility and Valuation in Focus
NuScale’s 10.6% intraday plunge underscores the precarious balance between its transformative SMR technology and overvalued stock. While the TVA partnership validates its strategic role in the energy transition, the market is pricing in skepticism about commercialization timelines and profitability. Investors should monitor the 30D MA at $40.84 as a critical resistance level and watch for a breakdown below $37 to confirm bearish momentum. Meanwhile, the sector leader Bristol-Myers Squibb (BMY) is down 1.46%, highlighting broader market caution. For SMR, volatility remains king—positioning for a directional move requires precision, as the stock’s -162.6 PE ratio and 15.46% turnover rate signal extreme risk/reward. Watch for $37 breakdown or a rebound above $41.06 to dictate next steps.