U.S. nuclear energy company Oklo Inc. (OKLO) has experienced a notable decline in its stock as its price has dropped roughly 30% over the past month. This decline follows the report of Microsoft’s cancellation of several data center leases, which led to market instability. However, Microsoft has dismissed reports of a business retraction and confirmed its intention to invest over $80 billion in infrastructure to meet growing customer demand this fiscal year. This suggests the market may have overreacted to the news. Meanwhile, Oklo has announced its engagement in the Department of Energy Voucher Program, aimed at enhancing efficiencies in manufacturing and overall scalability as the company accelerates the deployment of its commercial powerhouses.
A Promising Program
Oklo is at the forefront of advanced fission technology and nuclear fuel recycling company, building and deploying nuclear power plants. The start-up company went public in May through a merger with AltC Acquisition Corp., a special-purpose acquisition company led by OpenAI CEO Sam Altman. With 14 gigawatts of announced clients and partners, Oklo is in a prime position to address the increasing energy needs across various applications.
The company has recently committed to the U.S. Department of Energy’s (DOE) Voucher Program. This new collaboration is expected to assist Oklo’s Aurora powerhouse with testing critical structural materials for its Aurora powerhouse. This powerhouse, scheduled for installation at Idaho National Laboratory by 2027, features a design that utilizes recycled nuclear fuel and infrequently requires refueling, potentially as seldom as once per decade.
The program—the brainchild of the Bipartisan Infrastructure Law, Inflation Reduction Act and the Technology Commercialization Fund—is intended to boost manufacturing, supply chain, and scalability efficiency. Under the supervision of ENERGYWERX and Oak Ridge National Laboratory, the DOE’s Voucher Program will facilitate advanced material characterization and real-world testing to affirm high-performance materials for Oklo’s fast reactor designs.
Notably, the DOE isn’t granting funds directly to Oklo. Instead, the funding will be allocated to the DOE’s Oak Ridge National Laboratory, where testing will be conducted. The program aids companies like Oklo by connecting them with National Laboratories, providing access to testing facilities, expert consultation, and analytical resources, thereby advancing research and developmental activities. This strategy enables Oklo to leverage existing infrastructure and expertise, avoiding the need to build these resources from scratch, a crucial advantage as the company does not yet generate revenue.
Analysts Remain Bullish
Analysts following the company have been bullish on the stock. For instance, B. Riley’s Ryan Pfingst has reiterated a Buy rating and increased the price target on the shares from $27 to $58, noting the projected deployment of 7 GW by 2040 and a favorable macroeconomic landscape underpinned by strong U.S. policy support.
Oklo Inc. is rated a Strong Buy overall, based on the most recent recommendations of four analysts. The average price target for OKLO stock is $44.50, which represents a potential upside of 51.46% from current levels.
