Bank of America has upgraded its rating on the stock of nuclear energy startup Oklo Inc. (OKLO.US) from "Neutral" to "Buy," raising its price target from $111 to $127. This decision is based on Oklo's binding agreement with Meta Platforms, Inc. (META.US) to jointly develop a 1.2-gigawatt advanced nuclear energy campus to be constructed in phases.
Analyst Dimple Gosai from Bank of America noted that the agreement includes customer prepayments, which will fund the early-stage development prior to the signing of a final power purchase agreement. Although the contributed megawatt figure is not massive, it provides tangible proof of execution and a strong commitment from the partner.
The analyst added that investors are increasingly seeking concrete evidence of advanced nuclear energy projects moving from concept to implementation, and the agreement with Meta "provides exactly that kind of proof." Gosai stated that he remains optimistic about Oklo's business model, viewing the company as the publicly-traded small modular reactor (SMR) play with the highest leverage to data center demand.
Meta's willingness to commit capital years in advance—before interconnection is finalized, a formal PPA is signed, or permits are secured—highlights the growing importance of nuclear energy against the backdrop of accelerating AI and data center demand. The analyst suggested that recent news regarding data center operator Switch adding geothermal supply had somewhat overshadowed what should have been positive developments for Oklo.
Given Switch's significant share of the approximately 14-gigawatt announced project pipeline, Gosai pointed out that this geothermal PPA is relatively small and aligns with Switch's multi-technology strategy. "Relative to the hundreds of megawatts to multi-gigawatt load requirements of Switch's campuses, we view this as an incremental addition," he noted.
The analyst concluded that this geothermal development does not replace the potential for approximately 12 gigawatts of projects under the Memorandum of Understanding (MoU) between Oklo and Switch.
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