Oklo (NYSE:OKLO) has seen its price target raised by Wedbush analysts after the nuclear startup announced an anticipated agreement with the US government to provide power to the Eielson Air Force Base in Alaska.
Oklo on Wednesday revealed it has been issued a Notice of Intent to Award by the Defense Logistics Agency Energy on behalf of the Department of the Air Force and the US Department of Defense (DoD).
Should Oklo receive the award following an evaluation process, the company will design, construct, own and operate the power plant which will deliver both electricity and heat to the base.
The Wedbush analysts upped their price target to $75 from $55, describing the DoD deal as just the start of the nuclear AI demand story thesis for ‘Outperform’-rated Oklo.
Shares of Oklo traded hands at about $67 on Thursday, having surged more than 210% in the year to date.
Analysts highlighted that Oklo’s Aurora powerhouse design provides continuous and resilient energy that can operate independently from the grid, which are key attributes for energy security at remote installations like the Eielson Air Force Base.
The Trump administration continues to go all in on AI, the analysts added, noting an Executive Order signed by the president in May to accelerate the US nuclear energy industry by easing the regulatory process on approvals for new reactors and strengthening fuel supply chains.
“The US DoD has set the goal of quadrupling the nuclear power plant fleet to 400 GW of electric capacity by 2050 from the current approximately 100 GW level while also having the regulatory authority for nuclear plants on military bases, which was reinforced through the recent executive order, allowing them to significantly accelerate reactor deployments which represents a key tailwind for Oklo,” the analysts wrote.
“The recent Executive Order represents a significant tailwind for the industry with Oklo being the one of the main beneficiaries as support from the US Government has gained significant traction as the Trump Administration is keen on ensuring stays ahead of China in the Global AI Arms race.”
Wedbush concluded: “The AI Revolution is driving significant demand for clean energy to power AI initiatives with necessary computing power expected to grow 10x by 2030 putting Oklo in a great position to capitalize on this elevated demand and differentiate itself from competition with its attractive build, own, and operate business model which in turn provide long-term recurring revenues and a streamlined regulatory pathway.”