Key Points
NuScale Power stock is falling, but there's a lot more to it than just weak numbers.
Investors are questioning the nature of its exclusive partnership, and analysts are turning cautious.
It's been a brutal few weeks for NuScale Power (NYSE: SMR) stock. This week was no different, with the nuclear energy stock shedding another 9% to cap off a 33% decline in just about five weeks, as of this writing.
This week's drop, however, wasn't just another bout of market fatigue. NuScale Power is reeling under a brutal triad of poor numbers, multiple analyst downgrades, and cascading class action lawsuits, all in March.
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Here's all you need to know.
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Why are analysts turning sour on NuScale stock?
The optimism that fueled NuScale's rally earlier this year seems to have already evaporated, with several analysts slashing their price targets on the stock this week. Notable ones include:
Citigroup: cuts NuScale's price target from $18.50 per share to $11.50 a share with a sell rating
Royal Bank of Canada: slashes price target from $21 per share to $14 per share
Goldman Sachs: trims price target to $14 per share from $20 a share.
Last week, analysts from Craig-Hallum more than halved NuScale stock's price target from $53 apiece to $24 per share.
What's behind this rout?
On Feb. 26, NuScale reported a 15% drop in 2025 revenue and a staggering 700% increase in general and administrative expenses for the year, resulting in a net loss of $2017 per share, versus $1.47 per share in 2024.
One big number among those expenses caught everyone's eye: a $507.4 million payment to ENTRA1 Energy, NuScale's exclusive partner for the development and commercialization of its VOYGR small modular reactors (SMRs).
What happened next shook investor confidence in NuScale.
The questionable ENTRA1 link
A barrage of law firms has filed investor class action lawsuits against NuScale in recent days, alleging that the company misrepresented ENTRA1 Energy's experience and capabilities, wrongly leading investors to believe that the partnership would accelerate SMR deployment when it could actually trigger milestone payments exceeding $3
When I dug into NuScale's financial reports, one risk factor stood out: NuScale Power states that payments under its agreement with ENTRA1 could lead to "significant cash outlays in the near term without guaranteeing revenue-generating activities."
Could the markets be overreacting, and is this dip in NuScale Power stock a rare buying opportunity?
Should you buy NuScale Power stock now?
I have always maintained that NuScale Power is a speculative stock, simply because although SMRs have a lot of promise over traditional nuclear reactors, NuScale's first SMR is still years away.
Unfortunately, with CEO John Hopkins also selling 82,667 NuScale shares for over $1 million on March 3, I'd sit this dip out.
Should you buy stock in NuScale Power right now?
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Citigroup is an advertising partner of Motley Fool Money. Neha Chamaria has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Goldman Sachs Group and RBC Bearings. The Motley Fool recommends NuScale Power. The Motley Fool has a disclosure policy.
