Oklo teams up with Switch: did Cramer get it wrong on Oklo?

Oklo Inc (NYSE: OKLO) is pushing to the upside today after announcing a landmark power deal with Switch.

The agreement dubbed “one of the largest corporate clean power agreements ever signed” will see it deploy 12 gigawatts of nuclear power over the next two decades – and positions the advanced nuclear technology company to scale in response to growing demand.

Oklo stock is now up some 300% versus its year-to-date low in early September.

Oklo stock is keeping its recent gains

On October 29^th, famed investor Jim Cramer recommended staying away from Oklo stock that he argued was seeing a short squeeze.

But the New York listed firm has held its own over the past seven weeks, suggesting there may be a lot more at play here than a mere short squeeze.

Oklo, for example, has secured a recurring revenue stream and arguably a more stable financial future with its new deal involving Switch.

Others, including Microsoft, have already teamed up with Oklo as it turned to nuclear power amidst an AI-driven increase in energy demand.  

Such strategic partnerships highlight strong market demand for Oklo’s small nuclear reactors.

The added credibility may keep it an attractive investment and drive its price further up over the long term.

What Trump 2.0 may mean for Oklo

Oklo Inc expects its microreactors to cut both costs as well as timeline associated with setting up a new nuclear plant.

Additionally, the company sells power directly to customers under long-term Power Purchase Agreements (PPAs) that helps lower financial risk and upfront capital costs for customers.

More importantly, President-elect Donald Trump has picked Chris Wright – Oklo’s board member as the next energy secretary of the United States.

His appointment suggests the new government may offer at least some support to nuclear energy that could serve as a boon for Oklo Inc in the coming years.

Oklo stock debuted via a SPAC merger with AltC Acquisition Corp in May.

Oklo stock does come with risks

Oklo Inc is a Sam Altman backed nuclear power startup that counts billionaire Peter Thiel among early investors.

It offers unique means to play the expected rapid growth in artificial intelligence – a market that Statista forecasts will hit $1.0 trillion valuation over the next ten years.

Still, there are risks coupled with Oklo stock as well.

The California-based business is yet to deploy its reactor.

Its first plant is slated to go live in Idaho Falls in 2027.

Simply put, Oklo will likely be a pre-revenue company for another two to three years.

Therefore, the prospect of it diluting its shareholders to sustain operations remains very much on the table.

And the company doesn’t pay a dividend to make it easier for them to wait for it to start generating revenue either.