It may have taken a day to fully sink in, or maybe it took a day for investors to find the news. It’s clear, though, that they got the memo. Analysts have taken a more bearish stance on NuScale Power (SMR 3.45%) stock, and investors are selling shares in response. The general market downturn amid concerns about the U.S. military action in Iran is providing yet another catalyst for NuScale Power’s stock slide.
As of 2:30 p.m. ET, shares of the advanced nuclear reactor designer are down 3.8%, paring back an earlier decline of 10%.
Image source: Getty Images.
The week started with less optimistic expectations from not one, but two firms
NuScale Power’s stock started the week on an inauspicious note, with news of two price target cuts arriving before the opening bell. Citigroup cut its price target on NuScale Power stock to $11.50 from $18.50 while maintaining its sell rating. RBC Capital also tempered expectations, slashing its price target to $14 from $21.
Today’s Change
(-3.45%) $-0.45
Current Price
$12.60
Key Data Points
Market Cap
$3.7B
Day’s Range
$11.74 – $12.84
52wk Range
$11.08 – $57.42
Volume
762K
Avg Vol
27M
Gross Margin
33.84%
Based on NuScale Power’s shares closing at $12.85 on Friday, the Citigroup price target implied a downside of 10.5%, while the RBC Capital price target implied an upside of 8.9%.
In addition to the lower price targets, the conflict in Iran is affecting market sentiment toward NuScale Power. Oftentimes, when fear and uncertainty creep into the marketplace, investors shy away from growth stocks like NuScale Power and look to fortify their portfolios with more conservative stocks.
Does the current sell-off represent a buying opportunity?
While the two lower price targets may be disconcerting, investors should prioritize the company’s fundamentals over analysts’ opinions. For present NuScale Power shareholders, therefore, it’s better to remain steadfastly focused on the company’s progress toward commencing commercial operations in the United States and its financial health. That said, those uninterested in enduring the volatility of NuScale Power stock but who are still interested in exposure to the nuclear energy industry may prefer a more conservative approach, such as investing in nuclear energy exchange-traded funds.
Citigroup is an advertising partner of Motley Fool Money. Scott Levine has no position in any of the stocks mentioned. The Motley Fool recommends NuScale Power. The Motley Fool has a disclosure policy.
