NuScale Power Corporation (NYSE:SMR) Analysts Are Reducing Their Forecasts For This Year

The analysts covering NuScale Power Corporation (NYSE:SMR) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for this year. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting the analysts have soured majorly on the business. Bidders are definitely seeing a different story, with the stock price of US$5.92 reflecting a 10% rise in the past week. Whether the downgrade will have a negative impact on demand for shares is yet to be seen.

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Following the downgrade, the most recent consensus for NuScale Power from its 14 analysts is for revenues of US$20m in 2026 which, if met, would be a sizeable 91% increase on its sales over the past 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 42% to US$0.59. Yet before this consensus update, the analysts had been forecasting revenues of US$22m and losses of US$0.48 per share in 2026. So it's pretty clear the analysts have mixed opinions on NuScale Power after this update; revenues were downgraded and per-share losses expected to increase.

Check out our latest analysis for NuScale Power

The consensus price target was broadly unchanged at US$10.73, perhaps implicitly signalling that the weaker earnings outlook is not expected to have a long-term impact on the valuation.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the NuScale Power's past performance and to peers in the same industry. It's clear from the latest estimates that NuScale Power's rate of growth is expected to accelerate meaningfully, with the forecast 266% annualised revenue growth to the end of 2026 noticeably faster than its historical growth of 36% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 14% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect NuScale Power to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that analysts increased their loss per share estimates for this year. Unfortunately, analysts also downgraded their revenue estimates, although our data indicates revenues are expected to perform better than the wider market. We're also surprised to see that the price target went unchanged. Still, deteriorating business conditions (assuming accurate forecasts!) can be a leading indicator for the stock price, so we wouldn't blame investors for being more cautious on NuScale Power after the downgrade.

After a downgrade like this, it's pretty clear that previous forecasts were too optimistic. What's more, we've spotted several possible issues with NuScale Power's business, like major dilution from new stock issuance in the past year. For more information, you can click here to discover this and the 2 other risks we've identified.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks with high insider ownership.

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