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NuScale brought in no revenue this quarter, which was expected as the company is still in the early stages of building its small modular reactors. It reported a loss of 11 cents per share, slightly better than the 12 cents analysts expected. The company ended the period with 1.9 billion dollars in cash, which provides a significant cushion as it moves from designing technology to actually manufacturing parts.
The focus is now on physical production. NuScale recently signed a deal with Doosan Enerbility to build the reactor coolant system, a core piece of its power modules. It is also working with partners on a potential large-scale deployment with the Tennessee Valley Authority. For long-term owners, the lack of sales is less important than these manufacturing milestones and the company's ability to manage its cash until those first reactors are delivered.
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Source: 8-K filing
The company is expected to report a loss today as it continues to work on commercializing its small modular reactor technology. Since the business is still in the early stages of building out its first power plants, the most important things to watch are the cash balance and any updates on customer contracts. These details will show how much time the company has to reach profitability before it needs to raise more money.
NuScale signed a contract with Doosan Enerbility to continue building critical parts for its power modules. These parts are used in the upper cooling system of the company's small modular reactors, which are designed to be a simpler and smaller alternative to traditional nuclear power plants.
This is a helpful step forward because it secures the manufacturing capacity NuScale needs to eventually turn its designs into working hardware. While the company is still in the early stages of getting its technology deployed, keeping its supply chain moving with established partners like Doosan is necessary to meet its long-term goals.
Source: Business Wire
Truist Financial lowered its price target for NuScale from $10 to $8 on Thursday. This follows a week where other analysts have also grown more cautious about the company's near-term path. Even with the lower target, the firm still sees the stock as being worth more than its current price of about $5.60. The average target across all analysts who follow the company now sits at $10.
Source: Truist Financial
The company is scheduled to share its quarterly update on Thursday, November 5. Analysts are looking for a loss of about 12 cents per share on nearly zero revenue, reflecting the company's current stage of developing its small modular nuclear reactor technology rather than selling finished products. The focus for long-term owners remains on any updates regarding project timelines or new customer agreements, which matter more for the stock's value than the immediate profit or loss figures.
Management has a history of missing its own targets and reporting large losses. This makes it difficult to trust their forecasts while the business is still trying to get its first projects off the ground.
| Expectation | |
|---|---|
| EPS | $-0.10 |
| Revenue | $9M |
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