Freedom: AI-driven demand will support the nuclear sector, but a correction is possible after the rally

Rising electricity needs from data centers are supporting interest in nuclear power, however after a sharp jump in prices a partial profit-taking is possible, believes Freedom Broker analyst Vladimir Chernov. In his view, over the next few weeks sector stocks could gain another 5–10%, but the move will be accompanied by high volatility.

Which stocks took part in the rally

At the close of trading on November 6, Oklo (OKLO) shares rose by almost 23%. Shares of Centrus Energy, NuScale Power, X-Energy and Nano Nuclear Energy gained between 15% and 17%, while Vistra added about 11%. One catalyst for the rise was quarterly earnings. Oklo’s and NuScale’s losses came in smaller than analysts expected. The companies also reported progress on their projects.

Oklo develops small nuclear power plants and nuclear fuel recycling technologies. NuScale Power designs small modular reactors—lower-capacity power units compared with traditional large reactors. Their investment outlook largely depends on the transition from development to commercial operation.

Why investors are betting on nuclear power

Chernov links interest in the industry to the expansion of artificial intelligence infrastructure. The operation of data centers requires significant amounts of electricity, so investors are looking for companies that can meet growing demand.

The positive effect could extend to different parts of the industry: electricity producers, nuclear fuel suppliers and reactor developers. In the analyst’s view, this could also support the broader U.S. stock market.

However, the financial positions of sector participants differ significantly. Operating power plants are already generating income from energy sales, whereas many promising projects still require large investments before commercial operations begin.

After the price surge, the risk of profit-taking increases

A one-day rise of 15–23% increases the likelihood that some investors will decide to sell their holdings and lock in profits, Chernov notes. Therefore, sustained interest in nuclear power does not rule out short-term pullbacks.

The main uncertainty is related to project timelines and implementation costs. If construction, permitting or financing are delayed, expectations for future revenues may be revised.

The forecast of an additional 5–10% rise is viewed by the analyst as a short-term scenario for sector stocks, rather than a guaranteed outcome for each company.

Interest also extends to nuclear fuel

Previously, Freedom Broker looked at the prospects for Standard Nuclear, which specializes in fuel for next-generation reactors, including small modular units. Analysts noted that such projects should be assessed with long-term industry development factors in mind.

The current rally reflects expectations of future demand. For it to continue, companies will need to validate these expectations through contracts, adherence to schedules and progress toward commercial deliveries.

Not an individual investment recommendation.