NuScale Power Stock Before Q4 Earnings: Smart Buy or Risky Move?

NuScale Power SMR is scheduled to report fourth-quarter 2024 results on Feb. 27.Find the latest EPS estimates and surprises on Zacks Earnings Calendar.The Zacks Consensus Estimate for fourth-quarter sales is pegged at $1.23 million, suggesting a year-over-year decline of 73.03%.The consensus mark for fourth-quarter loss remains unchanged at 11 cents per share in the past 90 days. The figure calls for a year-over-year increase of 56%.NuScale Power Corporation Price and EPS Surprise NuScale Power Corporation price-eps-surprise | NuScale Power Corporation QuoteLet’s see how things have shaped up for the upcoming announcement.Factors to Consider for NuScale Power Ahead of Q4NuScale Power’s fourth-quarter performance is likely to have been driven by strong demand for electricity powering AI-supported data centers and clean energy. SMR is benefiting from a series of strategic initiatives that are aimed at aligning resources with its primary objective of moving toward commercialization and revenue-producing commercial contracts. NuScale’s collaboration with ENTRA1 Energy continues to gain traction, with a commercial model that mitigates risks and aligns with the needs of potential customers. This model’s success in meeting scalability, availability, and reliability needs is likely to be crucial for SMR deployments in the to-be-reported quarter.The company established a supply chain, including its partnership with Doosan Enerbility, which allows the company to maintain its manufacturing readiness. The ongoing progress in manufacturing and retooling facilities for SMR production is likely to have reduced lead times, increasing the ability to meet growing demand.SMR’s international opportunities, particularly in East and Southeast Asia, Eastern Europe, and Africa, are growing. Partnerships with entities like Regnum Technology in Ghana and ongoing projects in Romania and Korea are expected to have enhanced its global footprint and brought in new business in the to-be-reported quarter.SMR Trading at a PremiumNuScale Power shares have surged 553.4% in the trailing 12-month period, outperforming the Zacks Computer & Technology sector’s growth of 20% and the Zacks Electronics- Power Generation industry’s return of 278.9%.SMR Beats Sector, IndustryImage Source: Zacks Investment ResearchHowever SMR stock is not so cheap, as the Value Score of F suggests a stretched valuation at this moment.In terms of the forward 12-month price/sales (P/S), SMR is trading at 67.76X, significantly higher than its median of 17.74X and the Zacks Computer and Technology sector’s 6.35X.Price/Sales (F12M)Image Source: Zacks Investment ResearchNuScale Powers Growth With Clean Energy for Data CentersNuScale is gaining strong momentum across various sectors, especially as energy demands continue to rise. The increasing energy demand, driven by sectors like data centers, which require continuous, reliable, and carbon-free energy, has been a major growth driver.In response to this growing demand, data center power consumption in the United States is projected to rise from 25 gigawatts in 2024 to more than 80 gigawatts by 2030. This growth trend presents a significant opportunity for NuScale, as its Small Modular Reactor (SMR) technology offers consistent, carbon-free energy that can meet the increasing demands of hyperscale data centers.In December 2024, NuScale opened its Energy Exploration Center at The Ohio State University. The center aims to develop the next generation of nuclear professionals through hands-on learning and SMR simulations, reinforcing the need for skilled workers in the nuclear energy sector.NuScale’s 77-megawatt Light Water Reactor design, expected to receive Standard Design Approval by mid-2025, positions the company as a key player in meeting growing domestic and global energy needs through scalable, clean energy solutions.SMR Benefits From Tech Giants’ Commitment to Nuclear EnergyNuScale continues to attract strong interest from major technology companies and infrastructure capital. Companies like Amazon AMZN, Microsoft MSFT, Alphabet GOOGL and Oracle have made substantial commitments to using nuclear energy, including SMRs, to meet its sustainability goals, which positively impacts NuScale’s market positioning.Amazon’s acquisition of Talen Energy’s data center campus connected to a nuclear station and Microsoft’s commitment to nuclear energy have further validated the demand for SMRs in powering data centers and heavy industries.Companies like Google and Oracle are showing interest in using SMRs for large-scale data centers, reinforcing the growing trend toward nuclear solutions for energy-intensive tech operations. As these organizations align their energy strategies with sustainable nuclear options, the demand for SMRs continues to gain momentum, positioning NuScale at the forefront of this emerging energy market.What Should Investors Do With SMR Stock?NuScale’s advancements in SMR technology and its growing partnerships with tech giants and financial institutions position it as a key player in the future of sustainable, carbon-free energy.However, despite these innovations and collaborations, the company faces challenges in the highly competitive energy market, which includes the growing presence of renewable energy sources and regulatory hurdles. These factors could affect NuScale’s market positioning, even with its technological edge.The delayed commercialization of its small modular reactor technology, high operating expenses despite reductions, and the reliance on long-term, large-scale projects have further hindered its financial stability. SMR’s stretched valuation is also a concern.NuScale currently carries a Zacks Rank #4 (Sell), which implies that investors should stay away from investing in this stock at present.  You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Only $1 to See All Zacks' Buys and SellsWe're not kidding.Several years ago, we shocked our members by offering them 30-day access to all our picks for the total sum of only $1. No obligation to spend another cent.Thousands have taken advantage of this opportunity. Thousands did not - they thought there must be a catch. Yes, we do have a reason. We want you to get acquainted with our portfolio services like Surprise Trader, Stocks Under $10, Technology Innovators,and more, that closed 256 positions with double- and triple-digit gains in 2024 alone.See Stocks Now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Amazon.com, Inc. (AMZN): Free Stock Analysis Report Microsoft Corporation (MSFT): Free Stock Analysis Report Alphabet Inc. (GOOGL): Free Stock Analysis Report NuScale Power Corporation (SMR): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks