Wolfe Research on Tuesday opened formal coverage of two emerging nuclear developers, X-Energy and Oklo, awarding both companies Peer Perform ratings while indicating a stronger inclination toward X-Energy tied to its business approach and connection with Amazon.
In a research note, analyst Steve Fleishman positioned X-Energy and Oklo as participants in what the firm described as a nascent nuclear resurgence, a trend Wolfe links to expanding artificial intelligence workloads and growing demand for power in data centers. The firm emphasized that hyperscale cloud operators - which it said possess a strong willingness and financial ability to secure power - view nuclear power favorably because of its baseload reliability, dispatchability and lack of carbon emissions.
Wolfe cautioned, however, that nuclear power has limitations for rapid deployment and that cost outcomes remain uncertain. The firm noted that neither developer has yet reached revenue generation and that both companies hold cash balances in excess of $2 billion.
X-Energy, Wolfe wrote, benefits from a commercial arrangement with Amazon: the cloud giant is identified as a 5-gigawatt customer and holds a 17% equity stake. X-Energy is engineering reactor designs intended for deployment in the early 2030s.
By contrast, Wolfe characterized Oklo as pursuing a vertically integrated model and targeting a nearer-term deployment: the firm's first Aurora reactor is aimed for Idaho by 2028. That schedule, Wolfe said, makes Oklo a higher-risk, higher-reward investment relative to X-Energy. "OKLO feels like the higher reward, higher risk play," the note said.
Wolfe flagged the availability of HALEU fuel as a critical bottleneck for both companies, calling it a more immediate constraint than regulatory developments under the current administration. Overall, the research house described the sector as presenting a large opportunity but allowing little margin for setbacks, summarizing the outlook as a "big opportunity, but little room for disappointments."