On Thursday, Wedbush initiated coverage on shares of Oklo Inc. (NYSE: OKLO), a manufacturer of small modular reactors (SMRs), with an Outperform rating and a price target of $26.00, representing a 41% upside from the current price of $18.38. With a market capitalization of $2.24 billion, the company has attracted varied analyst targets ranging from $10 to $27.
The firm highlighted Oklo's innovative approach to providing nuclear power through a build, own, and operate model, which is expected to generate long-term recurring revenues. InvestingPro analysis suggests the stock is currently trading above its Fair Value.
Founded in 2013 and based in Santa Clara, California, Oklo is working to launch its first SMR by 2027. The company's flagship product, the Aurora, is a 15 MW passive compact fast microreactor designed to be scalable up to 50MW and 100MW.
Aurora is set to be one of the initial designs to utilize High-Assay Low-Enriched Uranium (HALEU), which offers enhanced power generation and reduced waste compared to traditional LEU.
Oklo's current project pipeline is progressing well, with the company reporting that it is 93% ahead of its planned deployment for 2027. The company has secured approximately 600MW of power under letters of intent, mainly from data centers, contributing to the 1,350 MW of power it aims to provide.
According to InvestingPro data, the stock has shown strong momentum with an 85.84% return over the past six months, though investors should note its high price volatility. The company maintains a robust liquidity position with a current ratio of 48.45.
The company's business model stands out in the industry by selling power directly to customers under long-term contracts, rather than the reactors themselves. This strategy not only ensures a steady revenue stream but also simplifies the regulatory process.
Oklo has a strong track record with regulatory bodies, having submitted over 500 technical and planning documents and 55 draft and final technical reports since beginning its pre-application process in 2016. The company has recently reached a significant milestone with the Department of Energy's (DOE) approval of its safety design strategy for the Aurora fuel fabrication facility.
Looking ahead, Oklo's product roadmap includes three different reactor sizes to meet diverse customer needs. While the 15MW and 50MW reactors are advancing, the 100MW design is still in the early stages of development.
For deeper insights into Oklo's financial health, growth prospects, and 12+ additional ProTips, visit InvestingPro, where you'll find comprehensive analysis and the detailed Pro Research Report covering what really matters for informed investment decisions.
In other recent news, Oklo Inc. has made considerable progress in the clean energy sector, with key developments including a non-binding Master Power Agreement with Switch (NYSE:SWCH), and plans to acquire Atomic Alchemy Inc.
The agreement with Switch involves the provision of 12 gigawatts of power from Oklo's Aurora powerhouses through 2044. This partnership is expected to bolster Oklo's operations while supporting the construction of its powerhouses across the United States.
On the other hand, the planned acquisition of Atomic Alchemy is set to enhance the supply chain for critical isotopes, essential for clean energy production in remote and off-grid environments. Alongside these developments, Oklo has also issued 2.5 million shares following a price milestone, a decision linked to a merger agreement with AltC Acquisition Corp. and Oklo Technologies, Inc.
In addition, Oklo has secured an Environmental Compliance Permit for its first commercial advanced fission power plant site at the Idaho National Laboratory. Analysts from B. Riley and Citi have initiated coverage of Oklo, with B. Riley emphasizing the potential of the company's advanced nuclear technology, while Citi maintained a neutral stance.
These recent developments reflect Oklo's ongoing efforts to advance in the clean energy sector.
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