NuScale Power Corp. (NYSE: SMR) dropped 13.66% intraday after UBS downgraded the small modular reactor developer to Sell from Neutral and slashed its price target.
UBS analyst Jon Windham cut his price target on NuScale to $6 from $10, implying approximately 40% downside from prevailing market levels.
Windham pointed to an extended build timeline and the absence of firm customer commitments as the core reasons behind the bearish call.
Competitors are already advancing toward construction, leaving NuScale at a structural disadvantage that Windham believes the market has yet to fully price in.
The analyst estimates the market is currently implying $124 million of 2028 EBITDA, against his own forecast of just $29 million, a difference of more than four times.
That gap of roughly $95 million represents what UBS views as a significant overvaluation embedded in NuScale’s current share price.
Windham’s model assumes only one NuScale project begins construction in 2028, a conservative assumption that underpins much of his bearish revenue and earnings outlook.
He also models roughly $700 million of cumulative cash burn between 2026 and 2028, a projection that underscores the scale of NuScale’s near-term financial challenge.
On the revenue side, Windham projects sales rising from $185 million in 2028 to $924 million in 2030, representing a 123% compound annual growth rate, though earnings remain negative throughout that period.
UBS flagged that project delays, setbacks at RoPower, and limited visible progress with the Tennessee Valley Authority could push actual results even further below consensus expectations.
A build timeline stretching beyond five years puts NuScale at risk of falling meaningfully behind rivals that are already breaking ground on comparable projects.
The combination of execution risk, customer commitment gaps, and a prolonged cash-burn runway presents a challenging investment case that UBS now believes warrants a Sell rating.
