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On Friday, BTIG initiated coverage on Oklo Inc. (NYSE:OKLO) with a Neutral rating, as the company embarks on a mission to transform the nuclear power industry. The company, currently valued at $3.2 billion, has shown remarkable momentum with a 148% surge over the past six months, according to InvestingPro data. Oklo is distinguishing itself by designing, owning, and operating small modular reactor (SMR) power plants, rather than just supplying reactor designs to utility companies. This strategic move aims to offer customers, especially data centers seeking power outside the conventional grid, a comprehensive integrated power solution.
Oklo's approach has already garnered interest, with the company securing six non-binding letters of intent for approximately 14 gigawatts of capacity. These initial agreements primarily involve data center companies, indicating a shift away from traditional utility company clients. While the company maintains a strong financial position with more cash than debt and a healthy current ratio of 43.47, InvestingPro analysis indicates the stock is trading above its Fair Value. The company's innovative molten metal reactor design, anticipated to be commercially available in the 2030s, is expected to provide enhanced safety and efficiency over the conventional light water reactors that currently dominate the market.
Despite the promise of Oklo's business model and technology, the company is still navigating the early stages of bringing its product to market. It is currently in the process of obtaining approval from the Nuclear Regulatory Commission (NRC) and aims to launch its first SMR power plant at the Idaho National Laboratory (INL) towards the end of 2027 or the beginning of 2028.
BTIG's analyst highlighted the potential of Oklo to supply stable, non-carbon power to customers seeking alternatives to traditional energy sources. However, with the company's commercial solution still several years away and dependent on regulatory approval, the Neutral rating reflects a watchful approach to Oklo's progress in the innovative nuclear power sector. Analyst targets range from $30 to $65, with InvestingPro offering additional insights through its comprehensive Pro Research Report, which provides deep-dive analysis of this and 1,400+ other US stocks.
In other recent news, Oklo Inc. reported a fourth-quarter earnings per share (EPS) of -0.07, slightly missing the forecast of -0.0665. The company's full-year operating loss was $52.8 million, with an adjusted operating loss of $40.3 million. Despite these financial challenges, Oklo has been included in the U.S. Department of Defense's Advanced Nuclear Power for Installations program, positioning it to potentially receive awards for microreactor power systems. Oklo also completed the acquisition of Atomic Alchemy, marking its entry into the radioisotope market. Analyst Vikram Bagri from Citi adjusted Oklo's stock price target to $30 from $31, maintaining a Neutral rating, and noted a "Modestly Negative" outlook due to Oklo's new 75MW reactor design. Herb Greenberg, a financial analyst, added Oklo to his "Red Flag Focus List," citing concerns over the company's valuation and lack of revenue, cash flow, and earnings. These recent developments highlight the challenges and opportunities facing Oklo in the competitive nuclear sector.
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