Is Oklo a Millionaire-Maker Stock?

Oklo (NYSE: OKLO), a developer of microreactors for nuclear plants, has generated some impressive gains since it went public by merging with a special purpose acquisition company (SPAC) last May. Its stock started trading at $15.50, but it now trades at nearly $120.

That rally wasn't a millionaire-making one for most investors, but it would have turned a $10,000 investment into more than $77,000. Let's see why Oklo's stock skyrocketed -- and how it has a shot at churning a fresh $10,000 investment into more than $1 million over the next decade.

Image source: Getty Images.

What does Oklo do?

A traditional nuclear reactor generates roughly 1,000 megawatts electrical (MWe) of power, but Oklo's Aurora microreactor only generates 1.5 MWe. However, Oklo's microreactors can be chained together in smaller modular deployments to generate 15 to 100 MWe of power. That flexibility makes them better suited for off-grid systems in remote areas.

The Aurora runs on metallic uranium fuel pellets, which are denser, more resistant to high temperatures, and cheaper to produce than the uranium dioxide fuel pellets used in traditional nuclear reactors. Those metallic uranium pellets can be reprocessed and recycled within a closed loop, so each Aurora microreactor needs to be refueled only once every 10 to 20 years. Traditional nuclear reactors must be refueled every one to two years.

Oklo's technology sounds like a major leap forward for nuclear power, and it generated a lot of buzz because OpenAI's CEO, Sam Altman, served as its chairman prior to its public debut. The U.S. Department of Energy (DOE) approved Oklo's permit to build its first reactor in Idaho, and it finally broke ground on that project this past September. The U.S. Air Force (USAF) also chose Oklo to build a small nuclear reactor for Eielson Air Force Base in Alaska earlier this year.

That progress is promising, but the Nuclear Regulatory Commission (NRC) hasn't yet approved its combined license for operating those reactors. Therefore, Oklo isn't generating any revenue -- but its net loss more than doubled from $32 million in 2023 to $74 million in 2024.

When will Oklo start generating revenue?

Oklo expects the NRC to approve the principal draft criteria (PDC) evaluation for its reactors under an "accelerated timeline" in early 2026, but it didn't say whether those designs would be fully approved. It doesn't plan to deploy its first reactors until late 2027 or early 2028, and the government doesn't expect them to be fully operational until 2030.

Analysts expect Oklo to finally generate $15 million in revenue in 2027 as it deploys its first reactor, but they also expect it to post a net loss of $70 million for the year. There's not much visibility beyond that, but its revenues should gradually rise through 2030.

However, that growth will be contingent on its timely NRC approvals, future government contracts, and its ability to stay ahead of small modular reactor (SMR) makers like Nuscale Power and entrenched nuclear power leaders like Westinghouse, which plans to start testing out its own eVinci microreactor in 2029. All those companies are trying to capitalize on the market's renewed interest in nuclear power -- which is being largely driven by the secular expansion of the cloud infrastructure and artificial intelligence (AI) markets.

As Oklo faces those challenges, investors will probably notice that too much optimism is baked into its valuation. With a market cap of $17.7 billion, it trades at 1,182 times the revenue it might generate in 2027. It still held $227 million in cash and equivalents at the end of its latest quarter, but a lot of that fresh cash came from its secondary offerings. It's already increased its number of outstanding shares by 21% since its public debut, and that dilution could worsen as it scales up its business.

Will it turn $10,000 into $1 million in a decade?

Oklo might eventually shake up the nuclear power industry, but it's still a speculative, pre-revenue stock that is trading at meme stock valuations. Therefore, I don't think it can turn a $10,000 investment into $1 million over the next decade. Instead, I wouldn't be surprised if it sinks much lower during the next market downturn.

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