The recent public debut of Oklo, a company specializing in microreactors for nuclear power, has garnered significant attention, particularly given the notable rise in its stock price following a merger with a special purpose acquisition company (SPAC). Initially opening at $15.50 per share, Oklo’s stock has now climbed to approximately $80, representing a remarkable gain for a company that has yet to generate any revenue.
A major factor contributing to this surge is the involvement of Sam Altman, CEO of OpenAI, who served as Oklo’s chairman prior to the merger. The excitement surrounding Oklo is largely due to its Aurora microreactor, which aims to simplify the deployment of off-grid nuclear reactors in remote locations. While the Aurora microreactor produces only 1.5 MWe of power compared to traditional reactors, which generate around 1,000 MWe, its modular design allows for the installation of multiple units, potentially increasing output to between 15 MWe and 100 MWe.
Additionally, the Aurora utilizes metallic uranium fuel pellets, which are denser and more heat-resistant than the uranium dioxide pellets used in conventional reactors. This innovative approach means the Aurora can be refueled every 10 to 20 years, drastically reducing maintenance downtime compared to traditional reactors, which require refueling every one to two years.
Despite its technological advancements, Oklo faces significant hurdles. It recently commenced construction on its first Powerhouse reactor in Idaho and has secured a contract with the U.S. Air Force to build a small reactor for Eielson Air Force Base in Alaska. However, regulatory challenges loom large; the Nuclear Regulatory Commission (NRC) has yet to approve Oklo’s combined license application for the deployment of its reactors. The company anticipates submitting a full application by the end of 2025, with the approval process expected to take an additional two to three years. Analysts project that meaningful revenue generation might not occur until 2027 or 2028, estimating $16 million in revenue for 2027 despite an anticipated net loss of $94 million that year.
Oklo’s current market cap stands at $13 billion, leading to concerns about its seemingly exorbitant valuation—at 813 times expected sales for 2027. Furthermore, the company frequently dilutes shares through secondary offerings and stock-based compensation. On a brighter note, the microreactor market is projected to grow at a compound annual growth rate (CAGR) of 17% from 2025 to 2035, driven by the increasing demands of cloud computing and artificial intelligence sectors.
In light of these trends, Oklo has entered numerous memorandums of understanding (MOUs) to explore global deployment of its Aurora microreactors and received letters of intent (LOIs) from major data center operators interested in utilizing its technology, which could pave the way for more binding agreements in the future.
Speculation about Oklo’s stock trajectory over the next five years remains high. If the company can maintain its leading position and secure long-term contracts, analysts suggest it might generate $28 million in revenue by 2030, given a robust growth rate of 20%. However, even at a premium valuation of 30 times that year’s sales, its market cap would total $840 million, a stark 94% reduction from its current valuation. On the optimistic side, if Oklo achieves faster growth of 50% and trades at 50 times sales, its market cap could reach roughly $3.5 billion, still approximately 73% below where it stands today.
While Oklo’s technology shows promise, its current valuation renders it more akin to a speculative venture than a straightforward growth stock. Analysts and investors are advised to approach with caution, favoring established players in the nuclear industry, such as Cameco, which is the world’s second-largest uranium miner, over investing heavily in Oklo at this stage.
