SMR Sector Continues Red-Hot Streak With 5 IPOs

Here’s the first edition of SMR Intelligence Update, with IPO news, additions to SMR Intelligence US, & the latest on China's ACP100.

Cutaway image of a plant with two ACP100 SMR reactors. Credit: World Nuclear News and CNNC.

Last week, during the Texas Nuclear Summit here in Austin, I got a friendly finger-wagging from the head of an SMR company about my reporting on the nuclear sector. This gentleman objected to my coverage. He said my reporting has been too negative and that I am ignoring the sector’s massive upside. Investors on Wall Street and elsewhere, he told me, are looking at the enormous potential of nuclear energy and the soaring global demand for electricity, and they are placing their bets accordingly. As part of that, they are providing capital to a wide range of companies with the belief that a handful of their bets will pay off in the future. I won’t quote his exact words, but the gist of it was “This is not a bubble.”

A few minutes after that conversation, I ran into a friend who has spent decades in investment banking. After relating the details of my chat with the SMR executive, my friend said that investors are “always overcapitalizing something.”

The question of overcapitalization is relevant given that Fermi America, a company co-founded by former energy secretary Rick Perry, which has no tangible assets and no active construction underway, now sports a market cap of about $12.2 billion.

As you may recall, Fermi — “The new nuclear arms race is not about weapons it’s about nuclear power” — went public last month in a splashy IPO. Fermi aims to use the $682 million it raised in the IPO to build gas-fired power plants, SMRs, and gigawatt-scale reactors, on a campus near Amarillo. The electricity the company generates will be used for, what else? AI.

How frothy is the SMR market?

On October 4, Jim Cramer, the TV talking head who never met a stock he couldn’t hype, declared that Fermi is “more of a business plan than an actual business.” Or consider Oklo. The startup SMR company has seen its stock price surge by about 600% this year. But even after declining by 15% on Wednesday, the company, which has no revenue, still has a market capitalization of some $18 billion.

In short, bubble or no bubble, the nuclear power sector — which just a few years ago was considered a dead industry — is rolling faster than a gravy train with biscuit wheels. Nuclear energy promoters are responding to the favorable market by taking their companies public as fast as they can. In doing so, they are collectively raising billions of dollars.

In this, the first edition of SMR Intelligence Update, we provide details on five IPOs in the SMR sector. We also have details on three new additions to SMR Intelligence US, and an update on the latest development in China’s SMR sector.