Last Update 23 Jan 26

Fair value Decreased 3.68%

SMR: Future Government Reactor Support Will Unlock ENTRA1 Fleet Deployment Path

Narrative Update on NuScale Power

Analysts have trimmed their implied fair value for NuScale Power to about $34.19 from $35.50, citing updated assumptions around deployment timing, working capital needs tied to the Partnership Milestone Agreement, and shifts in relative appeal across the renewables group as reflected in recent price target changes.

Analyst Commentary

Recent Street research around NuScale Power highlights a mix of optimism about long term potential and concern about execution timing and capital needs. Here is how bullish and bearish analysts are framing the story right now.

Bullish Takeaways

Bullish analysts see the clarified deployment timeline and payment structure to ENTRA1 under the Partnership Milestone Agreement as giving more visibility into NuScale's project path, even if the schedule is later than previously assumed.
The focus on monetization of NuScale equity by a major shareholder is viewed as a possible catalyst for improving float and liquidity, which some investors see as supportive for valuation work over time.
Q3 commentary around the potential timing of a firm order is interpreted by bullish analysts as a signal that NuScale is moving along a defined commercialization track, rather than operating on an open ended schedule.
Some bullish analysts argue that, after target cuts, the risk and timing adjustments are now better reflected in implied fair values. They see this as reducing the chance of further large estimate resets tied purely to scheduling shifts.

Bearish Takeaways

Bearish analysts have reduced price targets, citing a view that a firm order is more likely in 2026. In their view, this extends the path to revenue generation and pushes out key project milestones.
The revised outlook on working capital tied to the Partnership Milestone Agreement is seen as a source of funding risk, with concerns that timing of cash needs could pressure NuScale if external conditions are not favorable when capital is required.
Some bearish analysts point to changes in relative appeal across the renewables group, arguing that NuScale screens less attractively versus peers that they believe have nearer term revenue visibility or clearer earnings trajectories.
Target cuts that move implied fair value from about $40 to around $30 are framed by bearish analysts as evidence that earlier expectations around deployment timing were too optimistic. They remain cautious that further delays could weigh on sentiment.

What's in the News

NuScale shareholders approved an amendment to the Certificate of Incorporation at the December 16, 2025 special meeting, increasing authorized Class A common stock from 332,000,000 to 662,000,000 shares. This gives the company more headroom to issue new equity in the future.
NuScale filed a US$750 million at-the-market follow-on equity offering for its Class A common stock, providing a framework for raising additional capital over time through secondary issuances.
The company announced that its partner ENTRA1 Energy is positioned to receive up to US$25 billion under the US Japan Framework Agreement, which totals up to US$550 billion in planned public and private investment for energy and supply chain projects. ENTRA1 intends to develop a fleet of baseload power plants using NuScale SMR technology.
NuScale updated its bylaws in November 2025, designating the Chief Accounting Officer as a company officer and removing the requirement that the Controller also serve as Chief Accounting Officer. This refines the internal reporting structure.
The U.S. Department of Energy highlighted plans for the federal government to own as many as 10 large nuclear reactors funded in part by Japan's pledged capital, with NuScale mentioned among publicly traded nuclear-related companies that investors are watching in this context (Bloomberg).

Valuation Changes

Fair Value: trimmed slightly from US$35.50 to about US$34.19 per share, reflecting updated model inputs.
Discount Rate: inched up from roughly 9.08% to about 9.19%, indicating a modest change in the risk or return hurdle used in the analysis.
Revenue Growth: adjusted down from about 97.89% to roughly 95.11%, implying a slightly more conservative view on future top line expansion.
Net Profit Margin: increased from around 11.82% to about 12.32%, suggesting a marginally higher assumed level of profitability once the business scales.
Future P/E: brought down from roughly 161.36x to about 156.09x, pointing to a modest reset in how much investors might be willing to pay for projected earnings.

NuScale's advanced SMR commercialization and partnerships position it well for accelerated revenue growth and immediate deployment in competitive energy markets.
Efficiency improvements and strategic focus on reducing expenses are expected to enhance profitability and support margin expansion.
Challenges in securing agreements, funding uncertainties, and potential supply chain issues threaten cash flow, earnings, and profitability, despite project advancements.

Catalysts

About NuScale Power

Provides small modular reactor technology solutions.What are the underlying business or industry changes driving this perspective?

NuScale's involvement in the RoPower 6-module small modular reactor (SMR) power plant in Romania indicates future meaningful revenue and cash flow through its partnership in the Fluor-led Front-End Engineering and Design (FEED) Phase 2. This project enhances NuScale's revenue prospects.
With an NRC-approved SMR technology and the commitment of over $2 billion towards its development and licensing, NuScale is uniquely positioned for immediate commercial deployment compared to competitors focused solely on demonstration plans. This potentially accelerates revenue growth once commercial operations commence.
NuScale is advancing the manufacturing of long-lead materials for 12 modules, anticipating customer demand, which supports a smooth production ramp-up, reducing delivery times significantly, and potentially boosting future revenue and earnings.
Significant demand for nuclear energy, especially from AI-driven data centers like Microsoft and Meta, could lead to increased interest and order placements for NuScale’s SMR technology. This could materially increase future revenues as data centers triple their energy use by 2028.
NuScale's focus on reducing operating expenses, as noted by the substantial year-over-year decrease, could lead to improved net margins. Efficiency improvements transitioning from R&D to commercialization are likely to enhance profitability and support margin expansion.

NuScale Power Earnings and Revenue Growth

NuScale Power Future Earnings and Revenue Growth

Assumptions

How have these above catalysts been quantified?

Analysts are assuming NuScale Power's revenue will grow by 121.5% annually over the next 3 years.
Analysts are not forecasting that NuScale Power will become profitable in next 3 years. To represent the Analyst Price Target as a Future PE Valuation we will estimate NuScale Power's profit margin will increase from -368.8% to the average US Electrical industry of 10.5% in 3 years.
If NuScale Power's profit margin were to converge on the industry average, you could expect earnings to reach $42.2 million (and earnings per share of $0.12) by about April 2028, up from $-136.6 million today.
In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 248.0x on those 2028 earnings, up from -13.0x today. This future PE is greater than the current PE for the US Electrical industry at 19.7x.
Analysts expect the number of shares outstanding to grow by 7.0% per year for the next 3 years.
To value all of this in today's terms, we will use a discount rate of 7.48%, as per the Simply Wall St company report.

NuScale Power Future Earnings Per Share Growth

Risks

What could happen that would invalidate this narrative?

The complexity and negotiation challenges of securing long-term power purchase agreements with prospective customers could delay revenue generation and impact cash flow projections.
The U.S. government grant-related uncertainties and the administrative process of securing additional funding highlight a possible risk to future liquidity and investment inflow, potentially affecting financial stability and development timelines.
Potential bottlenecks in the supply chain or manufacturing process for the small modular reactors, despite current advancements, could lead to increased operational costs and affect net margins.
The dependence on the successful commercialization of ENTRA1 Energy projects and the potential delays in customer acquisition for NuScale's long-lead modules pose a risk to revenue forecasts and earnings projections.
The ongoing regulatory approval process with the NRC for the power upgrade and overall project complexity may result in unanticipated expenses or timeline shifts, impacting future earnings and profitability.

Valuation

How have all the factors above been brought together to estimate a fair value?

The analysts have a consensus price target of $24.46 for NuScale Power based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $29.0, and the most bearish reporting a price target of just $17.0.
In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $402.3 million, earnings will come to $42.2 million, and it would be trading on a PE ratio of 248.0x, assuming you use a discount rate of 7.5%.
Given the current share price of $13.91, the analyst price target of $24.46 is 43.1% higher.
We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.

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Disclaimer

AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.

SMR: Landmark US Nuclear Agreement Will Shape Commercialization Path Forward