NuScale Power Falls 7% as 10-Year Treasury Yield Climbs to 5.26%; Energy Fuels Drops 9%, Oklo Slides 5%

Nuclear power stocks are under heavy pressure as long-term Treasury yields rise, and the companies with the most distant returns are taking some of the sharpest hits. NuScale Power (NYSE:SMR) stock is at $6.04, down 7% in morning trading.

Meanwhile, Energy Fuels (NYSEAMERICAN:UUUU) stock is at $8.43, down 9%, the deepest decline in the group. Also, Oklo (NYSE:OKLO | OKLO Price Prediction) stock is at $30.11, down 5%, a smaller drop than NuScale Power shares are posting.

At the same time, the Global X Uranium ETF (NYSEARCA:URA) is down 4%, giving a read on the wider uranium and nuclear complex. The SPDR S&P 500 ETF Trust (NYSEARCA:SPY) is down 0.8%, which shows the selling is far heavier in nuclear names than across the broad market.

Hot Inflation Data Sends Long-Term Yields Higher

September inflation came in above forecasts, and long-term interest rates rose after the release, with the yield on the 10-year Treasury note moving higher. Such a shift lands hardest on long-duration assets, meaning companies whose expected cash flows sit years out. A higher discount rate reduces the present value of those future cash flows more than it does for companies making money now.

Nuclear developers carry a second exposure on top of that valuation math. Reactor buildouts are capital-intensive, so costlier borrowing raises the expense of financing each project. Rising yields therefore pressure these businesses twice, once in the valuation model and again in the construction budget.

Energy Fuels Breaks From the Duration Script

NuScale Power designs small modular reactors and earns most of its revenue from engineering and licensing work, while its value rests on reactors not yet built. It holds the only U.S. Nuclear Regulatory Commission design certification in the small modular reactor industry, but ENTRA1 Energy, which is advancing discussions with the Tennessee Valley Authority toward a definitive power purchase agreement, and a planned deployment at a former coal plant site in Doicești, Romania remain years from cash flow.

Oklo is developing its own reactor designs on a similar pre-revenue footing. The Aurora powerhouse at Idaho National Laboratory and deals including a master power agreement with Switch and a letter of intent with Equinix depend on power that hasn’t flowed yet, though Oklo has partnered with RPower on a gas-to-nuclear bridge strategy and acquired Atomic Alchemy for radioisotope production, possible paths to earlier revenue.

Energy Fuels mines and processes uranium and rare earth elements and sells physical output today. That near-term revenue would typically offer more protection from a higher discount rate, yet Energy Fuels stock is falling further than NuScale Power and Oklo shares.

A basket view helps explain the gap. The Global X Uranium ETF’s holdings include Oklo, NuScale Power and Energy Fuels alongside major uranium producers, physical uranium vehicles and enrichment companies, so its smaller decline reflects speculative developers making up only part of the weight. Still, the slide shows rate pressure reaching beyond pre-revenue developers.

Project Financing Is NuScale Power’s Open Question

NuScale Power’s order pipeline is unaffected by the bond market, but rising financing costs could change which projects customers actually build. Demand from data centers, along with uses in industrial heat, hydrogen and desalination, supports the long-term bull case (we mapped five ways to play the nuclear restart, utilities and fuel included, in a free report here), while a pre-revenue reactor business leaves NuScale Power shares exposed to every move in rates.

Oklo faces the same financing math as it works toward first commercial power delivery from its Idaho site. For its part, NuScale Power has some flexibility, since its NuScale Power Module is a small pressurized water reactor built to scale into multi-module plants, letting customers phase in capacity.

Energy Fuels stock remains a puzzle, with shares of a company selling physical product today trading like a long-duration developer. When all is said and done, it’s not a bad idea to limit your exposure to these volatile nuclear-stock names for the time being.

Contact [email protected] for any questions or corrections.