NuScale Power (SMR): The Case for a Long-Term Buy Right Now

Roaring out of the gate to start the new year, shares of NuScale Power (NYSE: SMR) soared 23.4% in January. Expand the perspective, though, and the next-generation nuclear reactor stock's performance is much less thrilling. As of this writing, shares of NuScale Power have plummeted 45.5% year to date.

But savvy investors know that when the market sours on a stock, a sweet buying opportunity sometimes emerges -- a phenomenon that is now the case with NuScale Power. Here's why.

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For some, shares of this nuclear leader have lost their luster

It wasn't so long ago that NuScale Power stock gleamed brightly in the eyes of growth investors. Two years ago, enthusiasm for artificial intelligence (AI) was booming, and the market soon learned that data centers required massive amounts of power due to the steep demands of AI computing.

Advanced nuclear reactor stocks like NuScale Power appeared to be the answer, and their stocks flourished. Shares of NuScale Power rocketed 445% in 2024.

Recently, however, investors haven't become restless, trimming -- or exiting altogether -- their positions. There's no clear catalyst for the decline of these stocks. Perhaps investors have lost patience with the companies' progress, or they've become disenchanted after learning that some communities are pushing back against the development of data centers. Or maybe it's the broad belief that an AI bubble has formed, and it's better to leave most AI-related stocks alone.

Don't be deceived -- NuScale has numerous opportunities

Investors would be short-sighted to assume that supporting data center infrastructure is the only opportunity for NuScale Power. In addition to water desalinization, the company recognizes hydrogen production facilities as two current applications for its small modular reactors (SMR).

Over the longer term, however, management recognizes additional use cases. In its annual report, NuScale Power states that it is developing micro-reactors for "niche end-markets" that would benefit from supplying power to remote, off-grid communities, including mining operations, universities, space, military installations, and disaster relief.

NuScale Power isn't alone in recognizing the growing market opportunity. According to the business intelligence firm Global Market Insights, the global small modular reactor market was valued at $3.6 billion in 2025 and is expected to total $5.3 billion in 2026, then rising at a 12.7% compound annual growth rate (CAGR) until 2035, when it's projected to total $15.6 billion.

Keep this in mind before buying this nuclear powerhouse

With growing market opportunities and the fact that NuScale Power is the only company that has small modular reactor (SMR) designs approved by the U.S. Nuclear Regulatory Commission, it's clear why forward-looking investors should find this nuclear energy stock so alluring. It's critical, though, that investors remember this high-reward stock also carries significant risks, as there's no guarantee the company will obtain the required operating licenses or achieve profitability.

For those uninterested in taking on higher risk, a nuclear energy ETF that includes NuScale Power among its holdings may be a more appealing option.

Scott Levine has no position in any of the stocks mentioned. The Motley Fool recommends NuScale Power. The Motley Fool has a disclosure policy.