SMR Should I Buy
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SMR is not a good buy right now for an impatient investor. The stock is in a clear short- and medium-term downtrend (bearish moving-average stack) and has broken below near-term support, while probabilistic pattern data also skews to further downside over the next day/month. Despite improving nuclear-policy sentiment and relatively bullish options positioning, the technical setup does not offer an attractive entry at the current price (~17.62) without waiting for confirmation (reclaiming key levels) or a catalyst.
Price/Trend: SMR is trending bearish with SMA_200 > SMA_20 > SMA_5, indicating a sustained downtrend rather than a simple dip. Today’s drop (-6.84%) reinforces downside momentum. Momentum: MACD histogram is slightly positive (0.0226) but “positively contracting,” suggesting any bullish momentum is fading rather than strengthening. RSI: RSI_6 at ~37.8 is weak/near oversold territory but not at an extreme that reliably signals an immediate reversal. Levels: Pivot 19.31 is well above the current price (17.62), so the stock is trading below an important inflection area. Immediate support S1 is 17.86 and price is already below it, increasing the risk of continuation to S2 ~16.97. Overhead resistance sits at ~20.76 (R1) then ~21.65 (R2), implying significant upside work is needed just to repair the chart. Near-term pattern odds: Similar-pattern analysis suggests a negative drift (80% chance of -1.44% next day; -4.03% next month), aligning with the bearish trend.
Policy and macro tailwinds: News flow highlights supportive nuclear-energy policy momentum and renewed demand for always-on clean power (including hyperscaler-driven interest).
Commercial progress narrative: Coverage notes NuScale’s differentiated position as the first/only NRC-approved SMR design (key credibility point vs peers).
Analyst support: Texas Capital initiated at Buy with a $23 PT (2026-01-27); BofA upgraded to Neutral (from Underperform) with a $28 PT after the correction (2026-01-09).
Upcoming event: QDEC 2025 earnings on 2026-02-26 (AH) can act as a catalyst if guidance/contracts/financing clarity improves.
raises risk of further selling toward ~16.
Timing risk: News suggests the first meaningful sale may not land until late 2026/early 2027, extending the “prove it” window.
Latest quarter provided: 2025/Q3. Growth: Revenue rose to ~$8.24M (+1635% YoY), indicating a large percentage increase off a small base. Profitability: Net income was still deeply negative at about -$273.3M (loss), and EPS was -$1.85—improving YoY by percentage but still far from profitability. Margins: Gross margin fell to ~30.55% (-19.37% YoY), suggesting cost pressure or less favorable mix. Bottom line: Top-line growth is encouraging, but the business remains loss-making with margin deterioration—consistent with the market’s ongoing focus on funding needs and dilution risk.
Recent trend: Ratings are mixed and price targets have generally been cut over the last few months, reflecting pushed-out deployment timelines and dilution/capital needs. Notable actions: RBC cut PT to $21 (Sector Perform) from $32 (2026-01-20). BofA upgraded to Neutral with $28 PT (2026-01-09) but reduced PT from $34. Multiple firms lowered PTs (UBS to $20, Goldman to $23, B. Riley to $24, Northland to $30). Latest positive: Texas Capital initiated coverage at Buy with a $23 PT (2026-01-27). Wall Street pros: Regulatory/design credibility (NRC-approved SMR), improving nuclear sentiment, differentiated exposure. Wall Street cons: Commercial deployment is not yet proven at scale, contract visibility is limited, and dilution/capital requirements remain a prominent overhang.
