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Dow Jones NewsSep 25, 11:32 AM UTC
MW Inside the zero-revenue nuclear stock whose 1,500% rally is shaking up the AI trade
By Christine Ji
Now worth $20 billion, Oklo has become the largest pre-revenue company listed in the U.S., as investors search for the next big AI trade
Oklo is expected to begin generating revenue by the end of 2027, according to Wall Street analysts.
No revenue, no problem. That's the modus operandi for investors in the nuclear technology company Oklo Inc.
As traditional artificial-intelligence plays such as the "Magnificent Seven" become more crowded, investors are eyeing more aggressive - and speculative - ways of generating returns. Shares of Oklo (OKLO) are trading at $131 after rallying nearly 520% in 2025 and nearly 1,500% in the last year.
It's an incredible feat for a company that has yet to record a single dollar in sales, but investors aren't buying into Oklo for its fundamentals.
Oklo's success has all the components of a "story" stock, or a company that trades on an exciting narrative rather than financial metrics, according to Chris Tessin, founder and managing partner of Acuitas Investments.
And Oklo certainly tells a good AI story. It's developing and commercializing small modular reactors (SMRs), which could be a promising source of energy for AI data centers. The company went public via Sam Altman's special-purpose acquisition company AltC Acquisition Corp. in 2024. The OpenAI Chief Executive also served as chairman of the company until this April, and currently holds a 5.5% equity stake in Oklo.
In today's environment, investors are willing to take on more risk if it means they can buy into the next big AI trade early. Oklo has become popular among the retail investor crowd. On Wednesday, the financial social-media platform StockTwits showed the message-volume indicator regarding the stock was "extremely high" and the sentiment indicator was "bullish."
"It's a more speculative, growth-focused environment that's reflective of where we are with falling interest rates, rising markets and individual investors participating to a greater degree," Tessin told MarketWatch.
All of these factors have pushed Oklo to an eye-popping $20 billion market capitalization. The valuation makes Oklo the largest pre-revenue company trading on a U.S. exchange today, a distinction highlighted by X user @SilbergleitJr and confirmed by Dow Jones Market Data.
Read on: 'Story' stocks are smoking hot in 2025. This is how it could end badly for investors.
On Monday, Oklo broke ground for its first commercial SMR at the Idaho National Laboratory as part of the Energy Department's Reactor Pilot Program, but the company is still far from monetization. According to FactSet data, Wall Street doesn't anticipate Oklo to bring in revenue until the fourth quarter of 2027.
Tessin likened Oklo's situation to that of clinical-stage biotech stocks, which often spend significant upfront investment preparing a drug for the market. If the product receives FDA approval, the company achieves a path to monetization. But if it fails, the company's primary asset could become virtually worthless overnight. The same "binary outcome" could be in store for Oklo's nuclear reactors, Tessin said.
The overall nuclear-energy industry is nascent, but some players have already generated revenue. Another player in the SMR space, NuScale Power Corp. (SMR), has reported sales since going public in 2022 and most recently recorded $8.1 million of revenue on its second-quarter earnings report. However, NuScale's revenues come from pre-commercialization activities, such as engineering and licensing services, meaning that its core business of selling nuclear power is still pre-revenue.
The risk-on investing attitude isn't just present among retail investors. Bank of America initiated coverage of Oklo last month with a buy rating and price target of $92, with analyst Dimple Gosai writing that Oklo is "best positioned to success in the early-adoption phase of the SMR market," with the "largest disclosed customer pipeline in the SMR space." Wedbush's Dan Ives was even more bullish, reiterating his buy rating and increasing his price target to $150 from $80 earlier this week.
In a note titled "The Long Game," UBS analyst Jon Windham initiated coverage of the company last month with a hold rating and a price target of $65. The game is indeed long - Windham doesn't expect Oklo to "achieve steady-state growth," characterized as deploying 800 megawatts a year, until 2034. Seaport analyst Jeff Campbell expressed more caution on Tuesday, downgrading the stock to neutral from buy. Campbell wrote that while Oklo's business development is trending in the right direction, the valuation is currently too elevated. But Campbell's perspective appears to be in the minority.
For now, the AI story remains a compelling one.
"It's easy to get your head around it if somebody says to you, 'This is an AI-related stock, nuclear is the new green energy, these guys are the leaders, they've got Sam Altman and others behind them,'" Tessin said. "It all sounds great, but at some point, you also have to make money."
The upside for Oklo is definitely significant. But the stock's current valuation depends on whether investors will stick around for nearly a decade while Oklo develops a business plan that consistently makes money.
Also read: Forget chips: The next battleground in the U.S.-China AI race is nuclear power
-Christine Ji
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09-25-25 0732ET
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