NuScale Power Shares Face Mounting Headwinds

Friday's trading session dealt a significant blow to NuScale Power's stock price. The sell-off was driven by a dual threat: a prominent downgrade from Wall Street and persistent investor anxiety regarding a potential oversupply of shares from its largest stakeholder.

Citi's research team provided the immediate catalyst for the decline. Analysts at the investment bank not only downgraded the stock but also slashed their price target substantially. Their rationale centered on increasing uncertainties surrounding the company's first confirmed customer contracts. However, a more substantial concern overshadowed this: the looming possibility of significant share sales by Fluor Corporation, NuScale's majority shareholder. Fluor continues to evaluate strategies to divest its substantial stake in the company. The prospect of this large block of shares entering the market has fueled fears of a supply glut that could depress the share price further.

Adding to the negative sentiment were recent insider transactions. Market participants took note of Chief Financial Officer Robert Ramsey Hamady's sale of 40,000 shares. During this period of heightened volatility, such moves are often interpreted by some investors as a signal of tempered internal confidence.

Should investors sell immediately? Or is it worth buying Nuscale Power?

The Core Challenge: High Costs and a Missing Anchor Customer

This recent turbulence follows disappointing quarterly results released in November. At that time, NuScale reported a much larger per-share loss than market experts had anticipated. While the company has bolstered its liquidity position to approximately $754 million through capital raises, its operational cash burn remains elevated. The path from possessing an approved reactor design to achieving profitable commercial deployment is proving to be a capital-intensive endeavor.

The fundamental issue persists unchanged: NuScale has yet to secure a first, major paying customer for its 77-megawatt small modular reactor (SMR) design. This lack of a definitive commercial anchor continues to weigh heavily on the company's valuation. Although management has expressed confidence in finalizing agreements by early 2026, the market is still awaiting concrete evidence.

Technical Weakness and a Waiting Game

From a technical analysis perspective, the breach of the $15 support level has left the equity in a vulnerable position. The stock is now trading well below its key moving averages, underscoring the prevailing downward trend. A sustained recovery is contingent upon the arrival of positive catalysts. The next potential trigger for a shift in momentum could be the company's scheduled business update or its subsequent quarterly report, expected in March 2026. Until then, the shares remain susceptible to negative developments, particularly any updates regarding Fluor Corporation's divestment intentions.