Key Highlights
- SMR shares touched a 52-week bottom at $8.85 following Fluor Corp’s divestment of 13.5M shares worth approximately $163M on April 9
- The director’s transaction reduced its ownership position by 33.8%, retaining 26.4M shares
- The company faces ongoing class-action litigation related to ENTRA1 disclosures, with investors alleging roughly 70% losses
- Fourth-quarter results severely underperformed — posting ($0.80) EPS versus ($0.10) consensus, while revenue of $1.81M fell far short of $8.76M projections
- Shares surged 11.90% on April 14 amid dip-buying activity, with market attention shifting to the upcoming May 7 earnings release
NuScale Power has endured significant turbulence recently. The company’s shares plummeted to a fresh 52-week bottom of $8.85 on April 14, only to stage a dramatic 11.90% recovery as bargain hunters emerged.
NuScale Power Corporation, SMR
The primary driver behind the decline was a substantial insider transaction. Director Corp Fluor offloaded 13.5 million shares on April 9 at a weighted average of $12.07 per share, generating approximately $162.9 million in proceeds. This massive sale trimmed Fluor’s holdings by 33.8%, with roughly 26.4 million shares remaining.
The magnitude and execution of this disposal spooked market participants. When a director liquidates one-third of their position in a single transaction, it naturally triggers investor concern.
As of April 14’s close, SMR traded at $9.59, representing a significant discount to its 200-day moving average of $21.41. The stock also trades considerably beneath its 50-day moving average of $12.56. Since the start of the year, shares have declined 32.39%.
Mounting Legal Challenges Create Additional Headwinds
Beyond the insider divestment, NuScale confronts several class-action lawsuits. Various legal firms — including Faruqi & Faruqi, Rosen Law, and Levi & Korsinsky — have initiated or announced investigations concerning ENTRA1 disclosures. The lead-plaintiff deadline falls on April 20.
The litigation alleges that ENTRA1 “veterans” lacked active nuclear development projects, with claimants asserting approximately 70% portfolio losses. This ongoing legal uncertainty continues weighing on investor sentiment.
The company’s latest financial performance compounded these challenges. In Q4, NuScale posted earnings per share of ($0.80), falling $0.70 short of the ($0.10) consensus forecast. Revenue totaled just $1.81 million, dramatically below the anticipated $8.76 million. The firm currently operates with a negative net margin of 1,130.26%.
Mixed Analyst Sentiment Persists
Wall Street remains divided on SMR’s trajectory. The consensus analyst rating stands at Hold, though the average price objective of $20.96 implies substantial upside — more than double current trading levels.
Barclays slashed its price target from $45 down to $15 while maintaining an Equal Weight stance. Goldman Sachs reduced its objective from $20 to $14, preserving a Neutral outlook. B. Riley maintains a Buy recommendation with a $24 target. Conversely, Texas Capital upgraded the stock to Strong Buy in January.
Regarding institutional activity, several prominent investors actually expanded positions during recent quarters. Vanguard boosted its stake by 40.5% in Q4. Morgan Stanley enlarged its holdings by 81%. Van ECK nearly doubled its position, increasing 117.8%.
Institutional ownership currently represents 78.37% of outstanding shares.
The April 14 rally appeared fueled by short-covering activity and opportunistic buying. Market participants are now focused on the May 7 earnings conference call, anticipating updates regarding project development timelines and potential new contract announcements.
Trading activity on April 14 exceeded 25 million shares, surpassing the typical daily average of 23.8 million.
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