Oklo (OKLO) Surges on Defense Microreactor Momentum
Warning! GuruFocus has detected 2 Warning Sign with OKLO.
The Defense Innovation Unit selected Oklo for its Advanced Nuclear Power for Installations program, which could open the door to military contracts involving small-scale nuclear reactors. The news sent the stock up sharply, capping a week where shares have gained over 130% year to date.
Still, Oklo's fundamentals remain speculative. The company generates no revenue and continues to report net losses, leaving the stock vulnerable to sentiment swings despite recent bullish technical signals.
This article first appeared on GuruFocus.
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Where Will Oklo Be in 3 Years?
Key Points Nuclear power is experiencing a resurgence amid rising energy demand, primarily driven by AI. Oklo is pioneering advanced nuclear fuel technologies, including its Aurora powerhouse product line. It's awaiting regulatory approval, and plant operations may not begin until 2027 at the earliest. 10 stocks we like better than Oklo › Nuclear energy stocks are heating up, and for good reason. This year, U.S. President Donald Trump has put nuclear power in the spotlight, and countries around the globe have pledged to triple their nuclear capacity by 2050. The excitement even extends beyond our planet, with Sean Duffy, Secretary of the Department of Transportation and acting National Aeronautics and Space Administration (NASA) administrator, floating the idea of using nuclear power on the Moon. What's fueling this nuclear renaissance? The unstoppable rise of artificial intelligence (AI). As AI systems grow more powerful, their appetite for energy soars, and nuclear is emerging as a leading contender to meet this demand. Enter Oklo (NYSE: OKLO), an upstart innovator in the nuclear sector. Founded in 2013, Oklo develops small modular reactors (SMRs) and innovative nuclear fuel solutions. Here's what investors can expect from Oklo over the next few years. Oklo's secret sauce in the nuclear space Oklo's Aurora powerhouse product line is based on proven liquid-metal-cooled sodium fast reactor technology, specifically leveraging the technology of the Experimental Breeder Reactor-II (EBR-II), which operated for over 30 years at the Idaho National Laboratory (INL). The Aurora powerhouse product line is designed to produce 15 to 75 megawatts electric (MWe) and has the potential to expand to 100 MWe and higher. As a metal-fueled fast reactor, Aurora powerhouses are designed to operate by harnessing the power of high-energy, or "fast," neutrons. This enables them to tap into the vast energy reserves remaining in existing used nuclear fuel from conventional nuclear power plants. Oklo's reliance on mature and validated technology is a key differentiator, as it allows it to move directly into commercialization without the need for a costly and time-consuming demonstration plant. The Aurora is designed from the ground up as a full commercial deployment. What to watch for in the next few years Oklo was the first advanced fission company to submit a custom Combined Operating License Application (COLA) to the U.S. Nuclear Regulatory Commission (NRC) in 2020. The NRC initially denied the application in 2022, citing the need for more information. The company initiated a pre-application readiness assessment with the NRC in early 2025 for its Aurora-INL Powerhouse COLA, indicating it is on track. Oklo plans to submit the first phase of this application by the end of the year. The NRC's review process can take two to four years, especially with Oklo's unconventional fast reactor design. If everything stays on schedule, Oklo could receive the green light from the NRC by 2027 or 2028, paving the way for plant operations to begin soon after. Oklo has also submitted its Licensed Operator Topical Report to the NRC, proposing a model where operators are licensed for the Aurora powerhouse technology rather than individual sites. This approach is a departure from traditional nuclear plant models and aims to streamline approvals and reduce timelines, enabling operators to monitor multiple powerhouses centrally. By strategically submitting topical reports like this one, Oklo is laying the regulatory foundation for faster licensing pathways. This "regulatory efficiency is central to Oklo's plan for scalable deployment across its fleet," Jacob Dewitte, co-founder and CEO, told investors during its first-quarter earnings call. 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