Oklo Has Massive Potential Due to Artificial Intelligence, but the Stock Is Sinking. Here's What I'd Do

One of the ways investors have taken advantage of opportunities related to artificial intelligence (AI) is to invest in energy companies that can also benefit from the boom related to next-gen technologies. Rather than investing in Nvidia or Palantir Technologies and more obvious AI stocks, many investors have turned to much smaller companies, with potentially much more upside in the long run.

Oklo (NYSE:OKLO) is a great example of that. It's not making chips or AI-related products and services, but it can potentially play a big role in the build-out of data centers, by providing them with the ongoing energy needs they're going to require via its powerhouses.

Last year, it soared 238% in value. Thus far in 2026, however, it's been a far different story, with the energy stock losing roughly half of its value. What's gone wrong with Oklo, and is it worth buying right now? Here's what I do with it.

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Why Oklo might be too risky to buy today

Oklo's stock is down big this year, as the hype has clearly been wearing off the energy stock. While its potential remains promising, the risk is still high as well. It could take years before Oklo generates any meaningful revenue and even longer before it posts a profit. And that's by no means a guarantee, either.

If Oklo's powerhouses prove to be the solutions to the clean energy needs of AI data centers, then the stock may undoubtedly soar in value. However, it's uncertain if things will play out that way. A lot hinges on not only the ongoing need and demand for data centers, but also on Oklo's execution.

Meanwhile, as the company scales and expands its operations, its losses may only intensify. Over the past 12 months, it has incurred $153 million in losses -- that's more than double the $74 million loss it incurred in 2024.

I'd put Oklo's stock on a watch list and forget about it

Although Oklo's stock has a lot of upside related to AI, it also carries tremendous risk. Investors don't need to buy the stock at these early stages to generate a great return from it. Instead, putting it on a watch list and tracking its progress can be a safer route to take.

Then, by waiting to invest in the company when its operations come in full swing and the financial results look encouraging, investors can decide to invest at that stage, when the risk is lower. While the stock would likely be at a far higher price than it is today, given the opportunities in AI, it wouldn't be too late to invest in Oklo and still earn a great return.

Investing now, however, when there's still so much risk and uncertainty ahead, may not be an appropriate strategy for most investors. Oklo is a stock worth watching, but I wouldn't rush to buy it today.

David Jagielski, CPA has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia and Palantir Technologies. The Motley Fool has a disclosure policy.