Could Buying Oklo Today Set You Up for Life?

Here's a fun fact: Last year, data centers globally consumed about 448 terawatt-hours (TWh) of electricity, with artificial intelligence (AI) accounting for a fifth of that total. That's more power than what the entire nation of Saudi Arabia consumes annually.

Now, consider this: Annual power consumption from data centers is estimated to double from 2025 levels to more than 945 TWh by 2030, with AI representing about two-fifths of that total. What's more, it can take years, sometimes longer, for a new data center to connect to the standard electric grid.

Taken together, these facts paint a pretty clear picture: Data centers consume an awful lot of electricity, demand is doubling, and the grid can't keep up with it. Now if only someone would just bring the power to data centers? That could solve several problems at once.

Well, that, in a nutshell, is what Oklo (NYSE: OKLO) is trying to do.

Oklo: The opportunity

Oklo is an advanced nuclear company designing a micro nuclear reactor -- Aurora powerhouse -- that can deliver clean, continuous energy directly where it's needed. Each reactor will be factory-built, simplifying construction, and designed to be transported to customer sites, which avoids the lengthy timelines associated with traditional nuclear plants.

Again, each Aurora reactor is modular, which is another way of saying that individual ones can be chained together to provide greater amounts of power. They're also engineered to run on a special fuel, which, in theory, will let them run for a decade or longer without refueling.

Image source: Oklo.

When Oklo stock came to the market in May 2024, it already had the backing of Sam Altman, head honcho of OpenAI. Today, that early vote of confidence has been complemented by partnerships with Meta Platforms, Nvidia, and Vertiv, just to name a few.

The market opportunity before Oklo could be massive. Not to repeat myself, but companies running large data centers are becoming desperate for clean 24/7 power, and they're only one slice of a potentially larger market. Think: remote communities, mining sites, oil drilling in Alaska, military zones, research facilities in Antarctica. Wherever power is needed remotely -- and the grid's arms can't reach -- is a potential opportunity for Oklo.

Oklo: Can it set you up for life?

Oklo stock is currently on the bottom end of a roughly 10-month slide. The stock, like other nuclear companies, hit a peak in mid-October of last year, after which it hasn't recovered its former high of the $190s.

Why the sell-off? The stock was pretty overvalued (still is, to some value investors). After Oklo, which still lacks NRC approval for Aurora and therefore isn't generating meaningful revenue, reached a market capitalization of about $24 billion, Wall Street realized enough was enough. The stock still carries an $8 billion market value -- which is pretty high for a company with almost no revenue -- but the stock trades at a slightly more favorable valuation than before.

If you were to invest a large amount in Oklo today, and the company fulfilled its ambitions, holding the stock long term could prove life-changing. At the same, there are risks to consider; I wouldn't recommend this stock for everyone, only those who can stomach the volatility. Those with less appetite for risk might want to check out a nuclear energy exchange-traded fund (ETF), as this can spread your investment across multiple companies rather than putting all your eggs in Oklo.

Steven Porrello has positions in Nvidia. The Motley Fool has positions in and recommends Meta Platforms, Nvidia, and Vertiv. The Motley Fool has a disclosure policy.