Top small modular reactor (SMR) stocks have fallen sharply this year, handing short sellers substantial gains. Oklo (NYSE:OKLO) has dropped 49% year-to-date and now trades 80% below its record high. NuScale Power Corporation (NYSE:SMR) has fared similarly, losing 43% this year and sitting 86% below its peak.
Oklo and NuScale Have Slumped as SMR Risks Remain
The ongoing retreat has benefited short sellers. Oklo has a short interest of 17%, while NuScale has 16%, a sign that many investors expect them to keep falling in the coming months. In a recent report, the FT estimated that these short sellers had made over $2 billion this year, while their market capitalizations have fallen by over $30 billion.
There are several reasons why these stocks have slumped this year. The most notable is the fact that Oklo, which is backed by Sam Altman, and NuScale are not yet making money. Instead, they are doing their R&D and hoping that their technology will become widespread, especially as the AI boom continues.
The fact that they are pre-revenue has pushed them to dilute their investors substantially. In August, the company filed to raise $750 million through share sales. Its outstanding shares have jumped to 410 million from just 23 million in 2021.
Oklo has done the same, with management filing to raise $1 billion in a share sale. Its outstanding shares have soared to 185 million from 122 million in 2024. This dilution will likely continue as the companies are too far away from profitability. For one, the companies are experience a shortage of high-assay low-enriched uranium, which is expected to come online in the second half of 2028.
Wyckoff Theory Explains Why Oklo and NuScale are Slumping
Oklo vs NuScale stocks chart | Source: TradingView
Traditional theories like Wyckoff also explain why the stocks are in a freefall. This theory, which has been around for over 100 years.
The theory identifies the four stages that assets go through: accumulation, markup, distribution, and markdown. These stocks remained in the accumulation stage in 2024 and then surged in 2025. This rally happened after several deals, including a large one between Oklo and Meta Platforms (NASDAQ:META).
The two stocks have now moved to the markdown phase, which is characterized by panic selling.
Still, shorting these companies carries risk, as they are prime candidates for short squeezes. A short squeeze occurs when a heavily shorted stock rallies sharply, forcing short sellers to buy back shares to limit their losses, which in turn pushes the price even higher.
Image: Shutterstock
Login to comment