Is OKLO Stock's 1000% Rally Hiding the Long Road to Profits?

Oklo Inc. (OKLO) has been one of the most talked-about names in the nuclear energy space. Its shares have surged more than 1,000% over the past year, briefly touching a 52-week high of $85.35 earlier this month. This meteoric rise has drawn attention from Wall Street and retail traders alike, making the stock a favorite among speculative growth investors. At first glance, Oklo seems perfectly positioned — offering exposure to nuclear’s comeback story amid soaring power demand from artificial intelligence data centers.However, investors should note that Oklo is still a company that is years away from making any money. A lot of the enthusiasm comes from the exciting idea of its small reactors that can provide clean and dependable power. However, a closer look at the company's financials shows a less certain reality. The company is still in its pre-revenue stage, requires a lot of capital, and must overcome complicated regulatory challenges. Even with support from key partners and a growing list of potential orders, the long wait for the company to start making money and its need for more funding create significant risks.This article examines the run-up in Oklo’s stock, looking at the reasons for its potential growth while also considering the major risks that could put pressure on shares. Since the stock's current price already seems to assume that everything will go perfectly, investors might want to be much more careful.OKLO’s Lofty Pipeline and Strong PartnershipsOklo has a strong lineup of potential customers and a big plan for the future. The company has a 14 GW order pipeline, which it believes could bring in nearly $5 billion in annual revenues by 2028. These customers, including data centers and military bases, need reliable power all the time. Instead of just selling reactors, Oklo plans to build, own, and operate them, and then sell the electricity to customers through long-term contracts. This approach is designed to create a steady stream of income once the projects are up and running.To make this plan a reality, Oklo has teamed up with several important partners, such as Liberty Energy, Vertiv, and Korea Hydro & Nuclear Power. These partnerships help the company with key parts of the business, from making sure it has the right fuel (HALEU) to developing specialized solutions for data centers. On paper, these partnerships give Oklo a major advantage over its rivals.The Reality Check: Long Timelines and No RevenuesDespite its exciting stock performance, Oklo is still in its pre-revenue stage, with its first power plant not expected to be operational until late 2027 or 2028 at the earliest. Until then, the company will require cash, with a likely annual cash burn of $65-$80 million. This significant cash burn and the long wait for revenues highlight the speculative nature of the stock’s current high valuation.The company also faces a major hurdle with regulatory timelines. Oklo's license application is not expected until late 2025, and reviews by the Nuclear Regulatory Commission can take between 24 and 36 months. Any delays in this process could push the timeline for making money well beyond 2028, creating a large cloud of uncertainty for investors.Dilution Risks Loom LargeIn June 2025, Oklo raised $440 million in equity, diluting existing shareholders significantly. More raises appear inevitable. Nuclear projects are highly capital-intensive, and without established revenue, Oklo’s growth depends on external funding. If market enthusiasm cools, the company could be forced into less favorable financing terms, adding pressure to its already speculative stock.This dynamic highlights why Oklo’s current valuation feels detached from fundamentals. At a 14.67 price-to-book (P/B) ratio, Oklo trades well above peers, despite having no revenue visibility for several years. For context, NuScale Power Corporation (SMR) — also a small modular reactor developer — trades at an even higher 20X P/B, but it has already received regulatory approval for its reactor design. By contrast, Constellation Energy (CEG), the largest U.S. nuclear operator with decades of reliable cash flows, trades at a much lower multiple and continues to expand its footprint profitably.Price Performance, Valuation, and EPS OutlookOver the past 12 months, Oklo’s shares have been up an astonishing 1,046%, far exceeding the gains of other nuclear energy companies like NuScale and Constellation Energy. This impressive performance isn't driven by actual earnings, but rather by speculative excitement from investors. The risk is that such massive increases in stock price are difficult to sustain, especially when the company's financial results have not yet caught up.1-Month Price Performance Comparison Image Source: Zacks Investment ResearchAs already discussed, from a valuation standpoint, Oklo’s premium is hard to justify for a company that won’t see revenues until late this decade. Meanwhile, Constellation Energy offers real earnings and dividends at a fraction of that valuation, while NuScale, despite its high P/B, at least benefits from broader global government support.Valuation Comparison Image Source: Zacks Investment ResearchEPS expectations reflect the long road ahead. Oklo’s EPS is projected to improve by 32% in 2025 but then decline by 11% in 2026, showing no sustainable path to profitability. By contrast, Constellation Energy generates consistent profits, and NuScale, despite losses, at least has clearer visibility into international interest and deployment pathways. Image Source: Zacks Investment ResearchConclusion: OKLO a Risky Bet Despite the HypeOklo’s 1,000%+ surge tells the story of a stock caught up in speculative excitement rather than grounded fundamentals. While the company has a strong list of potential customers, important partners, and support from the government, it still faces years of challenges. It has to navigate big hurdles in getting its projects built and approved by regulators, and the stock’s high value means it’s vulnerable to any setbacks.When we compare Oklo to a stable company like Constellation Energy, which provides steady cash flow, Oklo looks far more risky. For now, the stock is rated a Zacks Rank #4 (Sell). Investors who are impressed by the big rally should realize that most of the positive news is already reflected in the stock price. The road ahead for Oklo is long, uncertain, and costly, which makes it far from a good investment today.You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Quantum Computing Stocks Set To SoarArtificial intelligence has already reshaped the investment landscape, and its convergence with quantum computing could lead to the most significant wealth-building opportunities of our time.Today, you have a chance to position your portfolio at the forefront of this technological revolution. In our urgent special report, Beyond AI: The Quantum Leap in Computing Power, you'll discover the little-known stocks we believe will win the quantum computing race and deliver massive gains to early investors.Access the Report Free Now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Constellation Energy Corporation (CEG): Free Stock Analysis Report NuScale Power Corporation (SMR): Free Stock Analysis Report Oklo Inc. (OKLO): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks