Is Oklo Stock Worth The Risk?

Oklo (NYSE:OKLO), a nuclear energy startup backed by OpenAI’s Sam Altman, has surged more than 6x over the past 12 months. The stock is also up by over 55% over the last month or so. So what’s driving the gains? And is Oklo stock still worth it at current levels of about $63 per share?

Image by Markus Distelrath from Pixabay

Advanced Nuclear Tech With a Compact Footprint

Oklo is building compact, fast-spectrum microreactors that aim to deliver clean, safe, and cost-effective power. The company’s Aurora line of reactors aims for power capacity ranging from 15 to over 100 megawatts. This is a sharp departure from traditional nuclear power plants in the United States, which average about 1,000 megawatts. This translates into a smaller and much more flexible footprint. The reactors use fast neutrons and liquid-metal cooling, avoiding the complexity of high-pressure systems while improving fuel efficiency and safety. One of Oklo’s key innovations is its use of recycled nuclear waste as fuel, transforming a long-standing challenge into a valuable clean energy resource. With 10-year running times and no need for handling fuel on site, these microreactors could be well-suited to remote and high-demand use cases such as AI data centers, industrial sites, and defense installations.

Strong Electricity Demand, Regulatory Tailwinds

Electricity demand is set to rise sharply in the coming years, and nuclear energy is emerging as a compelling solution. Unlike intermittent renewables such as wind and solar, nuclear offers clean, stable, around-the-clock power. The tech industry is rapidly expanding data centers to support the energy-hungry demands of generative artificial intelligence, while President Trump’s big domestic manufacturing push and a broader shift toward electrification continue to drive up power needs.

There have been tailwinds from the government as well. Recent executive orders from President Trump target a fourfold increase in nuclear capacity from 100 GW to 400 GW by 2050. Crucially, the Nuclear Regulatory Commission is being streamlined, with new rules requiring reactor licensing decisions within 18 months. These changes are designed to fast-track the deployment of advanced technologies such as Oklo’s. The U.S. Department of Defense is also becoming an increasingly important customer – engaging the company to supply its emerging nuclear reactor technology to power the Eielson Air Force Base in Alaska.

Unique Risks

Oklo is a hard company to value. Its financials are not meaningful at this stage, as it remains a pre-revenue company. The plan is to build, operate, and directly sell electricity to customers via long-term contracts, with plants expected to go online only starting from around 2028 to 2029. Until then, the company will be burning through significant cash to fund research, development, and regulatory efforts – without any commercial revenues to offset the costs. This could create pressure to raise additional capital, potentially diluting existing shareholders or requiring the company to take on debt. Even once the technology is validated and deployed, manufacturing at scale will be a major hurdle – one that has tripped up many high-profile startups. The transition from prototype to full-scale production often comes with its own set of technical and operational challenges.

Not too happy about the risky nature of OKLO stock? The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming the S&P 500 over the last 4-year period. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.

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