Is NuScale Power (SMR) Stock a Momentum Play or a Strategic Bet on the Future of Nuclear Energy?

The debate over NuScale Power (SMR) stock has crystallized into a binary question: Is it a short-term momentum trade fueled by regulatory and political tailwinds, or a long-term strategic bet on the renaissance of nuclear energy? As the small modular reactor (SMR) developer navigates a pivotal year in 2025, its trajectory reflects both the promise and perils of capitalizing on a sector poised for transformation.

Momentum Drivers: Regulatory Wins and Investor Sentiment

NuScale's recent Standard Design Approval for its 77 MWe reactor design from the U.S. Nuclear Regulatory Commission (NRC) has been a catalyst for investor enthusiasm. This approval, the second for NuScale after its original 50 MWe design, positions the company as the sole SMR developer with NRC-certified reactors. The uprated design, capable of scaling to 462 MWe with six modules, addresses growing energy demands while retaining passive safety systems that rely on natural convection and gravity.

The stock price surge following this approval-over 12% in pre-market trading-has been amplified by high-profile partnerships. NuScale's agreement with ENTRA1 Energy to deploy up to 6 GW of SMR capacity with the Tennessee Valley Authority (TVA) represents the largest SMR deployment program in U.S. history. This deal, coupled with front-end engineering progress in Romania and 12 modules in production with Doosan, underscores NuScale's commercialization momentum.

Investor sentiment is further buoyed by NuScale's liquidity position. According to financial reports, the company ended Q3 2025 with $753.8 million in cash, bolstered by a $475.2 million at-the-market offering. While mixed analyst ratings persist-ranging from a "Sell" by Citigroup to a "Buy" by Canaccord Genuity- the median price target of $35.0 reflects optimism about NuScale's potential to capitalize on its first-mover advantage.

Strategic Foundations: Policy Tailwinds and Funding Catalysts

Beyond short-term momentum, NuScale's strategic value is anchored in a policy environment increasingly favorable to nuclear energy. Congressional hearings and executive actions in 2025 have accelerated nuclear deployment timelines, while the NRC's design approval streamlines project execution. The U.S.-Japan Framework Agreement, which allocates $550 billion for critical infrastructure, has further amplified NuScale's prospects. ENTRA1 Energy, its exclusive global partner, is poised to access $25 billion in funding under this agreement to develop SMR-based power infrastructure.

These developments align with broader energy transition goals. NuScale's SMRs are uniquely positioned to serve AI data centers, manufacturing hubs, and national defense applications, where reliable, carbon-free energy is critical. The company's role in Romania and its collaboration with TVA highlight its scalability and adaptability across geographies and use cases.

Risks and Challenges: Funding Pressures and Profitability Gaps

Despite these positives, NuScale's path to profitability remains fraught. The company reported a $136.62 million net loss in 2024, with revenue growth from $600K in 2020 to $37.05M in 2024 failing to offset operational costs. Its reliance on capital raises- exemplified by a shareholder-approved increase in authorized shares to 662 million-introduces dilution risks for existing shareholders.

Moreover, while NuScale has secured high-profile contracts, its near-term success hinges on converting these into concrete deployments. The absence of a fully operational SMR plant to date raises questions about technical execution and cost overruns. Analysts caution that without clear revenue visibility, the stock's valuation remains speculative.

Conclusion: Momentum vs. Strategic Viability

NuScale Power (SMR) embodies both a momentum play and a strategic bet. The regulatory approvals, policy tailwinds, and high-profile partnerships have created a short-term tailwind that justifies its stock's volatility. However, the company's long-term viability depends on its ability to secure contracts, manage capital expenditures, and demonstrate the economic and technical feasibility of its SMRs.

For investors, the key question is whether NuScale can transition from a policy-driven story to a profit-driven one. While the momentum is undeniable, the strategic bet requires patience and a tolerance for risk. In a world increasingly prioritizing decarbonization and energy security, NuScale's SMRs could become foundational assets-but only if the company navigates its financial and operational challenges with the same agility it has shown in securing approvals.