OKLO Pre-earnings Analysis
Companies like OKLO come around every once in a while and make headlines, leading them to big rallies fueled by positive catalysts and popularity, but many of these companies crash and burn when greed escapes the market and reality hits.
What is OKLO trying to do?
The world is on the hunt for energy solutions, one of the ideas introduced is small nuclear reactors (SMRs). We began talking about these early to mid last year when we covered $SMR, $OKLO, and $NNE.
Since then, these stocks have rocketed and fell back to earth…why? Because they were great picks at a time when momentum was high and greed was justifying insane valuations. OKLO is a ZERO revenue company that’s still in a pre-construction phase. The company is also attempting to build brand new SMR technology, an expensive task that they don’t even yet have approval for ($SMR does though, since we covered it last year 👀). So while the hype is there, and their backlog does show some contracts, executions risks remain high.
What matters right now:
Can OKLO survive long enough on its current cash runway before tapping out. The company has more than a billion in cash and marketable securities, which seems like a lot, but it’s very expensive to do what they’re doing. Earnings today will likely focus on operating losses, which have been low…if that number goes up, it could weaken confidence in the company’s long term outlook.
We don’t like to be stuck in companies that have little to no revenue and are still in predevelopment phase. An earnings play on OKLO is really a gamble, it’s not really a stock to want to be stuck in with a large position.
Option chain analysis:
OKLO's option chain expiring on April 17th currently reflects an implied volatility reading of 98.5%, which is about a (+/-) $15 move from the underlying stock.
March 20th shows a (+/-) $7.5 move.
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