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NuScale Power: Is Now the Time to Jump in or Just Watch?

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Written by Timothy Sykes Reviewed by Jack Kellogg Fact-checked by Ellis Hobbs

NuScale Power Corporation’s stocks have been trading higher, supported by momentum from recent news highlighting advancements in nuclear technology and potential partnerships in energy projects, On Friday, NuScale Power Corporation’s stocks have been trading up by 8.92 percent.

Recent Market Movements

  • Craig-Hallum analyst initiates coverage on NuScale Power with a buy rating and sets a $16 price target, signaling growing confidence in the company’s leadership in small modular nuclear reactors (SMRs).

Candlestick Chart

Live Update at 10:37:21 EST: On Friday, October 11, 2024 NuScale Power Corporation stock [NYSE: SMR] is trending up by 8.92%! Discover the key drivers behind this movement as well as our expert analysis in the detailed breakdown below.

  • NuScale has experienced a 17.1% stock price surge, reaching $11.25, reflecting market excitement and positive sentiment surrounding its advanced nuclear reactor technologies.

  • CLSA assigns an Outperform rating with an $11 price target, acknowledging NuScale’s pioneering role in nuclear technology despite anticipated operating losses in the near term.

  • Investment from Fluor and Department of Energy cost-share programs are expected to support NuScale until profitability is anticipated in 2028, bolstering investor confidence in the company’s future potential.

  • Upcoming Q3 earnings call scheduled for November 7, 2024, may provide further insights into the company’s financial health and strategic direction, with expectations of innovation-led growth.

NuScale Power’s Earnings and Financial Health

Diving into NuScale Power’s recent financial performance reveals a tapestry of highs and lows, much like climbing a rugged mountain path. The company’s adventure into the world of small modular reactors puts them on an exciting yet challenging road. NuScale’s Q2 financial reports highlight stark figures, with a net income of -$27.6 million and a negative operating income of $41.8 million. These are not just numbers; they represent the tough terrain of developing pioneering energy solutions.

Yet, there are highlights on the financial horizon. The capital infusion from Fluor, alongside the government’s cost-sharing initiatives, acts like a safety harness, helping NuScale navigate this rough climb. Despite carrying a current ratio of 2.7, indicating its ability to cover short-term liabilities more than twice over, profitability remains a distant summit. The company’s books show revenues shy of $967,000 against total expenses north of $42.8 million, a vivid reminder of the costs associated with being at the industry’s cutting edge.

NuScale’s large corporate steps are funded by significant movements in cash and stocks. Capital stock issuance is at $31 million, a substantial block of financial building that gives NuScale a sturdy capital base. Although depreciation and amortization are pegged at $402,000, operating cash flow sagged to -$36 million, a financial dip reflecting the strategic investments driving future growth.

More Breaking News

In terms of valuation, while typical metrics like price-to-earnings or price-to-cash-flow can’t yet be applied, NuScale’s prospects underscore the potential in scaling green nuclear solutions. This futuristic vision is NuScale’s real currency, capturing investor interest and fueling stock price leaps.

The Surge and Its Catalysts

NuScale Power’s recent share price surge gives the market plenty to chew on. With a stock that has bounded up by 17.1%, there’s a thrilling essence to this uptick, much like a sudden spark in a wood-chopping contest where every tireless swing seemed mundane until now.

Craig-Hallum and CLSA’s analyses have infused fresh life into NuScale’s stock. By painting a promising future in glowing terms, backed by robust price targets and buy ratings, these assessments add a glossy sheen to the company’s stock appeal. Furthermore, cozy alignments with powerful backers such as Fluor and the Department of Energy ensure the financial bedrock can support ambitious nuclear climbs.

Looking at the trading data candles, recent resilience and volatility capture the essence of a company in transition—NuScale seesaws between skepticism and optimism. The latest price movements, hiking up to a $13.07 close from $11.78, illustrate a narrative of investor sentiment warming, perhaps expecting more nuclear breakthroughs from this glowing ember of innovation.

Strategic Impacts and Future Outlook

The convergence of these reports, the enthusiasm from analyst circles, and the salvaging influence of backers craft a potent story of potential recovery. As investors mull their next steps, NuScale’s story adds layers of intrigue, reminiscent of a suspense-filled novel where the next chapter’s twists and turns hold both risk and opportunity.

Down the road, the upcoming Q3 call serves as a narrative pivot, where shareholders and analysts keenly await words straight from the company’s leaders—words that may paint a vivid picture of their roadmap, laden with choices that could steer the stock figures.

Certainly, NuScale’s operational margins and financial metabolism will shape their quest for market dominance. Positive analysts’ feedback and robust backing imply faith, possibly hinting at NuScale’s financial narrative maturing into a stable storyline.

Conclusion

NuScale’s evolving story—a tapestry of daring innovations and determined resolve—promises an enthralling journey for those observing and engaged in the energy sector. Aided by positive analyst reviews and strong financial support, even amidst potential losses and a current lack of profitability, adventurous investors find reasons to believe in its trajectory. Yet, as the market anticipates transformative earnings and strategic unveiling in the company’s conference call, the decision remains suspended like a bridge over deep valleys—painted with potential and weighted by risk.

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Timothy Sykes

Tim Sykes is a penny stock trader and teacher who became a self-made millionaire by the age of 22 by trading $12,415 of bar mitzvah money. After becoming disenchanted with the hedge fund world, he established the Tim Sykes Trading Challenge to teach aspiring traders how to follow his trading strategies. He’s been featured in a variety of media outlets including CNN, Larry King, Steve Harvey, Forbes, Men’s Journal, and more. He’s also an active philanthropist and environmental activist, a co-founder of Karmagawa, and has donated millions of dollars to charity. Read More

* Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here

The available research on day trading suggests that most active traders lose money. Fees and overtrading are major contributors to these losses.

A 2000 study called “Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors” evaluated 66,465 U.S. households that held stocks from 1991 to 1996. The households that traded most averaged an 11.4% annual return during a period where the overall market gained 17.9%. These lower returns were attributed to overconfidence.

A 2014 paper (revised 2019) titled “Learning Fast or Slow?” analyzed the complete transaction history of the Taiwan Stock Exchange between 1992 and 2006. It looked at the ongoing performance of day traders in this sample, and found that 97% of day traders can expect to lose money from trading, and more than 90% of all day trading volume can be traced to investors who predictably lose money. Additionally, it tied the behavior of gamblers and drivers who get more speeding tickets to overtrading, and cited studies showing that legalized gambling has an inverse effect on trading volume.

A 2019 research study (revised 2020) called “Day Trading for a Living?” observed 19,646 Brazilian futures contract traders who started day trading from 2013 to 2015, and recorded two years of their trading activity. The study authors found that 97% of traders with more than 300 days actively trading lost money, and only 1.1% earned more than the Brazilian minimum wage ($16 USD per day). They hypothesized that the greater returns shown in previous studies did not differentiate between frequent day traders and those who traded rarely, and that more frequent trading activity decreases the chance of profitability.

These studies show the wide variance of the available data on day trading profitability. One thing that seems clear from the research is that most day traders lose money .

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Citations for Disclaimer

Barber, Brad M. and Odean, Terrance, Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors. Available at SSRN: “Day Trading for a Living?”

Barber, Brad M. and Lee, Yi-Tsung and Liu, Yu-Jane and Odean, Terrance and Zhang, Ke, Learning Fast or Slow? (May 28, 2019). Forthcoming: Review of Asset Pricing Studies, Available at SSRN: “https://ssrn.com/abstract=2535636”

Chague, Fernando and De-Losso, Rodrigo and Giovannetti, Bruno, Day Trading for a Living? (June 11, 2020). Available at SSRN: “https://ssrn.com/abstract=3423101”