The Past, Present, and Future of Nuclear Power

A Compelling Case for Speculating in SMR Stocks vs. SpaceX

Below we have linked our 16-slide video presentation regarding the past, present, and future of nuclear power. The condensed version of the argument is that after fifty years of stagnation, the industry now has a chance of revival with small modular reactor (“SMR”) technology. Government policy is supportive, and the smaller up-front capital costs of SMRs versus legacy nuclear plants lowers the financial risk for customers. What has not been settled is whether anyone in the West can build a SMR plant on budget.

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There are only two small modular reactors under construction anywhere in the West (the BWRX-300 at Darlington, Ontario and Natrium at Kemmerer, Wyoming), and the latest SMR technologies you may have read about exist only on paper and in press releases. We already have one live example of a customer walking away from a signed project once the cost per kilowatt became too expensive, which tells you the demand is real but not infinitely price inelastic. It is not clear that this technology will be viable at scale.

While the SMR category is a high-risk investment, this risk does appear to be at least partially reflected in the stock prices relative to some other speculative stocks. Contrast them with SpaceX, which has similar if not higher levels of risk and uncertainty, but is priced as though commercial viability is a given. On a relative basis, SMR technology could be a better way to invest in the opportunity to supply growing power needs for the AI buildout than SpaceX.

The SMR vs Space X Speculative Comparison:

The two listed SMR pure plays in our presentation (Oklo and NuScale) carry a combined market cap of about $9.2 billion. While exorbitant relative to fundamentals, that is a meager ~0.65% of SpaceX’s valuation. SpaceX’s market capitalization is roughly 155 times the entire publicly traded SMR developer complex. SpaceX and the SMR plays are of the same category of promise, a technology that has not yet delivered a commercial unit, a customer set that is real but contracted rather than paid, and a delivery model that has yet to be proven.

Drastically different valuations for two unproven options.  We note that the addressable market for SMRs is the entire electricity demands of humanity.  This is larger than just space orbiting data centers.  Thus, the ever-popular “TAM” – Total Addressable Market – is likely much larger for SMR companies than SpaceX.

The SMR vs. SpaceX Contrast is Difficult to Ignore:

1. With SpaceX you are buying technology that does not yet exist.
2. With Oklo and NuScale the tech works, and you are waiting on a delivery model that must prove itself.
3. SpaceX is a bet on invention and execution with multiple points of failure between here and outer space.
4. In contrast, SMR is a bet on execution alone, the work is terrestrial, and you are paying far less for it.

Oklo and NuScale still face a multitude of challenges, and it is entirely possible that neither succeeds. But there may be a lot less speculative hype priced in.  At a $9.2 Billion combined market cap, the market is pricing in success of SMRs at a much lower value than a more speculative wager in SpaceX, in our view.

Consider SpaceX as an alternative investment. SpaceX has a market cap of roughly $1.9 trillion while reporting billions in cash losses with estimates of future cash needs running to $1 trillion in just the next four years. Nobody is sure where the money will come from.  As lockups expire in the months ahead, we understand the company may try to use its earnings release to buoy the price of the miniscule float to inflate the entire company’s valuation.  But a trillion dollars in immediate future capex requirements combined with a cascading series of expiring lockups could create serious downward pressure on a stock priced for perfection.

In our view, SpaceX’s valuation suggests it is already a monopoly with enormous margins on data center demand that could collapse if the circular financing that has driven the sector evaporates. For those looking to revisit just how precarious the financing bubble is, we would point you to our pieces Accounting Gimmicks on a Grand Scale or even our November 2025 note on AMD. As we explained in our paper The High Price of Promises, SpaceX looks more like a massive flyer on a CEO who has a history of making promises that are rarely kept, in our view.

A large share of SpaceX’s market cap rests on orbital data centers that do not yet exist in any operational form. If you invest in SpaceX, you are betting on yet-to-be invented technology at a valuation that already assumes it works at full scale. The promises certainly appear to already be priced into the stock. There is no margin of safety whatsoever, in our view.

We hope the presentation on SMR technology below provides incremental value in any subsequent research potential investors in the technology may perform.