3 Nuclear Energy Stocks Down 40% or More From Their Highs -- Only 1 Is a Real Opportunity Right Now.

The nuclear market cooled off for roughly a decade after the 2011 Fukushima disaster as more countries throttled or paused their nuclear expansion plans. But over the past few years, the nuclear market warmed up again, thanks to new decarbonization initiatives, the development of safer nuclear technologies, and the growth of the power-hungry cloud and AI markets.

According to the International Energy Agency (IEA), the world's nuclear capacity could increase by more than 50% by 2050. That's why several nuclear stocks hit all-time highs over the past year. But since then, many of those top stocks -- including NuScale (NYSE: SMR), Oklo (NYSE: OKLO), and BWX Technologies (NYSE: BWXT) -- have fallen off a cliff.

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All of those high-flying stocks lost their luster as the Iran war, inflation, and rising interest rates drove investors toward more conservative investments. NuScale and Oklo trade 86% and 79% below their record highs, respectively, while BWX has pulled back about 40%. Let's see why only one of those stocks is a real buying opportunity in this messy market.

Why aren't NuScale and Oklo contrarian plays yet?

NuScale and Oklo both develop smaller nuclear reactors that are prefabricated in factories, transported to the site, and assembled in a modular manner. Those modular designs can be deployed in remote areas, reducing the time and cost required to construct a nuclear plant.

NuScale's small modular reactors (SMRs) generate 77 MWe, while Oklo's Aurora microreactors only generate 1.5 MWe. NuScale's SMRs must be refueled every 21 months, but Oklo's microreactors can last for about a decade without refueling because they can reprocess their fuel pellets in a closed loop. NuScale's SMRs -- like conventional reactors -- are still cooled with water. Oklo's reactors are cooled with liquid metal, which eliminates the need for groundwater.

Both of those technologies sound game-changing, but neither company has deployed a working commercial reactor yet. NuScale plans to deploy its first commercial reactors in the early 2030s, while Oklo aims to deploy its first Aurora Powerhouse reactors in late 2027 or early 2028.

Until that happens, both companies will generate most of their revenue from engineering studies, grants, contracts, and milestone payments. With a market cap of $3.1 billion, NuScale trades at 24 times its 2027 revenue. Oklo, which is worth $6.8 billion, trades at 770 times next year's sales. Neither company will break even anytime soon. Therefore, both of these stocks could be cut in half -- or more -- before they're considered cheap turnaround plays.

Why is BWX Technologies a more stable investment?

BWX Technologies, which was spun off from Babcock & Wilcox (NYSE: BW) in 2015, is a diversified bellwether of the nuclear market. It's the only large-scale producer of specialized nuclear components, fuel systems, and naval reactor systems in North America.

It's one of the few U.S. companies licensed to work with regulated nuclear materials, handle high-assay enriched uranium (HALEU) and tri-structural isotropic (TRISO) fuel, and develop naval reactor components for the U.S. Navy. It even produces microreactors that are cooled by gas rather than liquid metal and generate about 1-5 MWe.

In other words, BWX is a much larger and more stable nuclear play than NuScale and Oklo. It was also better insulated from the aftermath of the Fukushima disaster over the past decade, since it generated most of its revenue from defense contracts with the U.S. Navy.

From 2025 to 2028, analysts expect BWX's revenue and EPS to grow at CAGRs of 13% and 16%, respectively. Yet its stock still looks reasonably valued at three times next year's sales and 28 times next year's earnings. So if you're looking for a balanced and profitable way to profit from the nuclear market's resurgence, BWX checks all the right boxes.

Leo Sun has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends BWX Technologies. The Motley Fool recommends NuScale Power. The Motley Fool has a disclosure policy.