Key Points
The artificial intelligence (AI) boom is already well underway. Globally, $7 trillion is projected to be spent over the next few years alone on scaling data center infrastructure. All those data centers will need power — lots of it. That’s where nuclear energy can play a key role.
Many nuclear energy stocks are worth consideration. Investors looking to bet on rising energy demand from AI companies, however, may be best off narrowing their focus to SMR stocks.
Image source: Getty Images.
SMR stocks — which specialize in small modular reactors — are attractive for several reasons. These miniature nuclear power plants are faster, cheaper, and safer to deploy than conventional nuclear plants, at least on paper. Only two SMR systems are currently commercially active globally, though more than 80 are in some stage of development.
If you’re looking for pure-play SMR stocks, there are two clear options with varying go-to-market strategies.
These nuclear power stocks specialize in SMRs
NuScale Power (NYSE: SMR) is the only company in the U.S. approved by regulators to build an SMR system. The biggest project in its pipeline is a 6-gigawatt system for the Tennessee Valley Authority, a major southeastern U.S. utility provider.
NuScale is focused on meeting AI’s energy needs by delivering power to grid suppliers in a traditional way. Oklo (NYSE: OKLO), meanwhile, is taking a more direct approach, pitching its systems directly to AI companies. It already has some deals signed with data center companies. But like NuScale, none of these systems have financial commitments yet.
NuScale’s $4 billion market cap is arguably more attractive than Oklo’s $40 billion valuation. But the choice ultimately comes down to how investors assess their go-to market approaches. If a traditional grid approach works, NuScale is the better pick. If marketing directly to AI companies is superior, Oklo clearly has the upper hand.
Consider giving both a closer look to see if any other factor might help tip the scales.
Should you buy stock in NuScale Power right now?
Before making an investment decision, evaluate NuScale’s regulatory approval status and partnerships with established utilities like the Tennessee Valley Authority.
