NuScale Power Stock Is Down 75% in 12 Months. Here's Why.

In the summer of 2025, nuclear energy stocks were having a moment. Indeed, if you had bought shares in the VanEck Uranium and Nuclear ETF on June 30 of last year and stayed invested until at least Oct. 15, your investment would have grown roughly 47% -- an astonishing return for an exchange-traded fund (ETF).

Mention of Oct. 15 in the above example isn't arbitrary. It was, in retrospect, the peak of enthusiasm for nuclear energy stocks. Indeed, if you had bought shares of the VanEck Uranium and Nuclear ETF on Oct. 15, 2025, and stayed invested until today, your investment would have lost about 30% of its original value by now.

Long-term NuScale Power (NYSE: SMR) investors have similarly witnessed a dismal drop in the value of this developer of small modular reactors (SMRs), to the tune of a 75% decline. The reason for this sell-off isn't complicated; it was always there for investors to glean. Here's what's going on with NuScale.

NuScale stock raced ahead of its business

The most obvious reason for NuScale's fall is that the company became one of Wall Street's favorite AI power stocks even before NuScale showed the market a commercial reactor. The company has, to put it plainly, never deployed an SMR for commercial use. Even though NuScale has beaten every other small reactor developer to the punch by certifying an SMR design first, that design hasn't materialized in the real world.

This fact has never been hidden from investors, but it might have been subdued against the background of artificial intelligence (AI) and data center construction. NuScale's strongest tailwind last year -- which is still blowing, just with less force -- was its potential to meet tech companies' and hyperscalers' demands for power, which are expected to surpass the traditional grid's capacities. However, that demand hasn't manifested in strong SMR sales for NuScale, which could be a few years from deploying even one.

Image source: Getty Images.

On top of that, enthusiasm for AI has also abated. Fears of an AI bubble -- which originally caused the mid-October peak in 2025 to crumble for nuclear energy stocks -- have made investors more selective about the stocks they pick for this trend. I wouldn't say nuclear energy, in general, is off the table. However, given the longer timelines for nuclear reactor projects, and the billions needed to build them, tech companies are going with other solutions -- like fuel cells from Bloom Energy -- that make demand for nuclear slightly less urgent.

It's "less urgent" for now, at least. If the world fills up with data centers, as Sam Altman once predicted, then nuclear could still unleash the $10 trillion market opportunity that Bank of America estimated it would hold.

Should you buy the dip on NuScale Power?

NuScale has two projects in the works: one in Romania, and the other for the Tennessee Valley Authority (TVA). Right now, the "works" are pre-development -- mostly planning -- and they likely won't manifest anything concrete until the 2030s, assuming they proceed on schedule.

As such, investors should treat NuScale as an early-stage developer with growth potential over decades, not years. I would only recommend this stock for those who have an appetite for risk, as it's not clear where this stock will be a decade from now.

Bank of America is an advertising partner of Motley Fool Money. Steven Porrello has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bloom Energy. The Motley Fool recommends NuScale Power. The Motley Fool has a disclosure policy.