Key Takeaways
- SMR shares touched a 52-week bottom at $8.85 following Director Corp Fluor’s disposal of 13.5M shares worth approximately $163M on April 9
- The substantial sale reduced Fluor’s ownership by 33.8%, with 26.4M shares remaining in its portfolio
- Several class-action lawsuits remain ongoing, connected to ENTRA1 disclosure claims suggesting investors suffered roughly 70% losses
- Fourth-quarter results significantly underperformed — posting EPS of ($0.80) versus the anticipated ($0.10), while revenue reached $1.81M compared to $8.76M projections
- Shares surged 11.90% on April 14 as bargain hunters entered, with market participants focused on the upcoming May 7 earnings announcement
NuScale Power has experienced significant turbulence recently. Shares fell to a fresh 52-week bottom at $8.85 on April 14 before staging a dramatic 11.90% recovery as opportunistic investors entered positions.
NuScale Power Corporation, SMR
The primary trigger for the decline was a substantial insider transaction. Director Corp Fluor disposed of 13.5 million shares on April 9 at a weighted average of $12.07 per share, generating approximately $162.9 million in proceeds. This transaction decreased Fluor’s ownership position by 33.8%, leaving approximately 26.4 million shares in its holdings.
The magnitude and execution timing of this divestiture unsettled market participants. When a director reduces their position by one-third in a single transaction, it naturally prompts investor concerns.
Shares closed at $9.59 on April 14, representing a substantial discount to the 200-day moving average of $21.41. The stock also trades considerably beneath the 50-day moving average at $12.56. Since the beginning of the year, SMR has declined 32.39%.
Litigation Concerns Weigh on Sentiment
Beyond the insider divestiture, NuScale confronts multiple class-action legal challenges. Various law firms — including Faruqi & Faruqi, Rosen Law, and Levi & Korsinsky — have initiated or disclosed investigations concerning the ENTRA1 disclosure matter. The lead-plaintiff application deadline is scheduled for April 20.
Legal complaints assert that ENTRA1 “veterans” lacked operational nuclear projects and maintain that shareholders experienced approximately 70% portfolio losses. This ongoing legal uncertainty continues to weigh on investor confidence.
NuScale’s latest financial performance provided little relief. In Q4, the organization posted earnings per share of ($0.80), significantly missing the analyst consensus of ($0.10) by $0.70. Quarterly revenue totaled $1.81 million, dramatically underperforming the $8.76 million analyst forecast. The company currently operates with a negative net margin of 1,130.26%.
Mixed Analyst Perspectives
Wall Street analysts remain divided regarding SMR’s trajectory. The consensus rating stands at Hold, with a mean price target of $20.96 — representing more than 100% upside from current levels.
Barclays reduced its price objective from $45 down to $15 while maintaining an Equal Weight stance. Goldman Sachs lowered its target from $20 to $14, preserving a Neutral rating. B. Riley maintains a Buy recommendation with a $24 price target. Texas Capital reversed course, upgrading shares to Strong Buy in January.
Regarding institutional activity, several prominent investors actually accumulated shares in recent reporting periods. Vanguard expanded its position by 40.5% during Q4. Morgan Stanley boosted its holdings by 81%. Van ECK nearly doubled its investment, increasing by 117.8%.
Institutional ownership currently represents 78.37% of outstanding shares.
The April 14 price recovery seemed fueled by short position covering and value-seeking investors. Market participants are anticipating the May 7 earnings conference call, where management is expected to provide updates regarding project developments and potential contract announcements.
Trading activity on April 14 exceeded 25 million shares, surpassing the typical daily average of 23.8 million shares.
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