Citi analysts have spotlighted investment opportunities within the nuclear sector, recommending exposure to the upstream supply chain as the market adapts to both SMR development and the maintenance and uprates of existing nuclear plants. Their assessment weighs political constraints, restart activity, and project execution risk when identifying where investors may find durable exposure.
The bank notes that deals driven by hyperscalers involving existing nuclear generation remain constrained by political considerations, even as technical uprates at current reactors appear to be gaining momentum. Citi’s proprietary foot traffic tracker, which the firm uses to gauge activity at plants, shows that restarts are moving forward in a measured fashion. However, that same tracker does not indicate imminent large-scale dealmaking at any particular facility.
On the topic of recent consolidation, Citi addressed NextEra Energy’s latest acquisition. While acknowledging there could be concentration risk associated with the deal, the analysts indicated limited concern about the Nuclear Regulatory Commission process and suggested that the additional sites could support NextEra’s ambitions around SMR development.
The bank’s analysis also highlights a notable trend among incumbent nuclear owners - many are electing to remain on the sidelines of new-build SMR projects because they are not willing to assume the risk of cost overruns. That reluctance means that, while a small number of companies are continuing to advance SMR initiatives, the pace of progress in early phases will likely be slow and deliberate.
Looking further ahead, Citi expects SMRs to become a meaningful component of U.S. power generation in the early 2030s. Given the breadth of the current pipeline - with more than 100 different SMR designs under consideration - the firm prefers upstream suppliers, reasoning that these vendors should benefit regardless of which specific reactor technologies ultimately gain market traction.
Top names highlighted by Citi
- Centrus Energy Corp. - Within its coverage universe, Citi is most constructive on Centrus. The analysts view upstream nuclear supply chain exposure as attractive and see Centrus as positioned to benefit regardless of which SMR technologies prevail. The company reported first-quarter 2026 results that missed analyst expectations for both revenue and earnings per share.
- NuScale Power Corp. - Citi is least constructive on NuScale among the nuclear stocks it covers. The firm acknowledges that NuScale continues to execute in the SMR space but expresses greater caution about its near-term prospects compared with upstream supply-chain companies. NuScale’s first-quarter 2026 earnings report showed revenue that was significantly below expectations, and BofA Securities has initiated coverage with a Neutral rating.
Overall, Citi’s stance favors companies supplying equipment and services to the emerging SMR market rather than owners shouldering the financial and execution risk of new-build projects. That preference reflects the firm’s view on how political considerations, regulatory processes, and cost-overrun exposure are likely to shape which market participants capture value as SMR deployment moves from planning into construction and, eventually, operation.