Can SMR Stock Beat the Market?

A month ago, if you asked whether NuScale Power (NYSE: SMR) was beating the market, you could answer, "yes." At the time, shares in this developer of small modular nuclear reactors were up nearly fourfold over the past year, over fivefold over the past three years, and nearly sixfold since the 2022 special purpose acquisition company (SPAC) merger that took the company public.

However, following a steep pullback for the stock, NuScale has gone from outperformer to underperformer. Shares lag the S&P 500 (SNPINDEX: ^GSPC) stock market index on a one-year and three-year basis. Now, there's still potential for shares not only to make up for this recent wave of losses, but also to experience a full-on breakout in price.

The problem, though, is that well before this happens, chances are the stock continues to tumble back toward prior lows.

Image source: Getty Images.

How NuScale Power stacks up against the S&P 500

As seen in the chart, NuScale shares have lagged the S&P 500 over a one-year and three-year period.

Data source: Author research.

NuScale shares have technically beaten the market since their public debut, but just barely. Again, this relatively weak performance is mainly due to a sudden drop in the stock price. For much of 2025, the stock was performing well. Investors bid up this early-stage company, namely due to the potential for its small nuclear reactors to be in high demand, to meet the energy requirements of the AI infrastructure buildout.

However, since mid-October, NuScale's stock price has fallen by over two-thirds, from the high-$50s to the high-teens per share. Chalk this up to many factors. Enthusiasm for the AI data center trend is simmering down. Recent developments also suggest that NuScale's involvement in a deal with the Tennessee Valley will not translate into material revenue anytime soon.

Add in a poorly received quarterly earnings release, plus plans from large shareholder Fluor (NYSE: FLR) to continue selling its NuScale stake, and it's not surprising that shares have fallen so far, so fast.

A new wave of outperformance could still happen, but tread carefully

Down the road, NuScale could once again beat the market, largely thanks to the high operating leverage with its asset-light business model. By working with strategic partners on the construction of small modular reactors, NuScale could generate relatively high earnings from providing services and licensing its technology.

Also, NuScale is currently the only small modular reactor developer to have Nuclear Regulatory Commission approval. This could give it a first-mover advantage. The issue, however, is that the potential boom times for this industry remain years away.

Meanwhile, cash burn remains very high. NuScale currently has around $753.8 million in liquidity, but negative operating cash flow for the first nine months of 2025 totaled nearly $256 million. If high cash burn persists, NuScale may have to once again tap into the equity markets to raise more capital. This could lead to share dilution, pushing the stock lower.

In short, while the NuScale long-term bull case has yet to fully shatter, you may want to take your time before entering a position.

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