On Tuesday, Citi revised its price target for Oklo (NYSE: OKLO), a company engaged in the development of nuclear powerhouses, from $11.00 to $10.00 while maintaining a Neutral rating on the stock. The adjustment follows a recent discussion with Oklo's CFO Craig Bealmear and Director of IR Sam Doane.
The company is currently in ongoing discussions with the Nuclear Regulatory Commission (NRC) as it advances towards a pre-application readiness assessment scheduled for later this year.
Oklo is actively preparing the ground for its first Aurora powerhouse site in Idaho. Amid these developments, the company has decided to file its first application under the ADVANCE Act, despite the legislation not coming into effect until 2025. This strategic move is in response to a higher than anticipated demand for the 50MW powerhouse, prompting a reevaluation of the initial submission to the NRC. Oklo aims to ensure that future permits will be focused solely on site-specific details.
The first Aurora powerhouse is anticipated to become operational by the end of 2027. However, Citi is taking a cautious approach, modeling the first deployment to occur in 2028. This conservative outlook has led to a slower projected rate of powerhouse deployments, which in turn has influenced the decision to lower the target price to $10.00 per share. Citi's revised price target reflects these updated expectations for Oklo's project timeline and regulatory engagement.
In other recent news, Oklo Inc. has been making waves in the nuclear technology sector. The company reported its quarterly financial results, providing an insight into its operational and financial status. Oklo has also entered into a Preferred Supplier Agreement with Siemens Energy, a move aimed at further commercializing its advanced fission technology. This collaboration is expected to enhance the reliability and performance of Oklo's powerhouses.
B. Riley initiated coverage on Oklo, highlighting the potential of the company's advanced nuclear technology and its unique business model. This model offers several operational and regulatory advantages, including reduced approval timelines and regulatory costs. However, Seaport Global Securities and Citi have both initiated a neutral stance on Oklo stock, citing potential challenges including regulatory hurdles and concerns related to fuel procurement and management.
Oklo has made significant progress in nuclear fuel recycling technology, thanks to a $5 million cost-share award from the U.S. Department of Energy's Advanced Research Projects Agency-Energy. This advancement is expected to significantly reduce nuclear waste and fuel costs.
Furthermore, Oklo has filed a registration statement with the U.S. Securities and Exchange Commission for over 62 million shares of common stock, previously unregistered for resale. These are the recent developments for Oklo Inc.
InvestingPro Insights
Following Citi's recent price target revision for Oklo (NYSE: OKLO), it's notable that the company holds a stronger cash position than debt, as highlighted by one of the InvestingPro Tips. This financial stability could be crucial as Oklo continues its discussions with the Nuclear Regulatory Commission and prepares for the pre-application readiness assessment later this year. Additionally, despite the conservative outlook from Citi, Oklo has experienced a significant return over the last week, which may interest investors looking for recent performance indicators.
From the provided InvestingPro Data, Oklo's market capitalization stands at $1.02 billion, reflecting the size and scale of the company within the industry. However, the company's negative P/E ratio over the last twelve months as of Q2 2024 suggests that it has not been profitable during this period, which aligns with the InvestingPro Tip indicating that analysts do not anticipate profitability this year. The strong return over the last month could be a signal of investor confidence or market reactions to specific events or announcements made by the company.
For investors seeking a more comprehensive analysis, there are additional InvestingPro Tips available that provide deeper insights into Oklo's financial health and market performance. These tips, which include assessments of gross profit margins, stock price volatility, and dividend payments, are accessible through the InvestingPro platform. Specifically, there are 11 additional tips available for Oklo, offering a more detailed perspective for those considering an investment in the company.
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