The 6 GW agreement is criticized as "promising pie", Citigroup downgrades nuclear newcomer NuScale (SMR.US) to "sell" rating.

Citigroup downgraded the rating of U.S. small modular nuclear reactor developer NuScale Power (SMR.US) from "neutral" to "sell," with a target price of $37.50. The company's stock price fell 12.8% on Tuesday. Citigroup cited reasons for the downgrade including, "binding customer contracts are still difficult to finalize, increased competition from new entrants, continued pressure from major shareholder Fluor reducing its stake, and the company's high valuation." Analysts at Citigroup estimate that NuScale's current stock price implies expected reactor construction of around 16 gigawatts by 2040, while the bank predicts total installed capacity in the United States to be around 56 gigawatts by then. Citigroup believes that "such high market share expectations are unrealistic in a competitive market, especially considering that the company has not yet secured any customers." NuScale had previously stated a target to reach a customer agreement by the end of 2025, with a framework currently in place for a potential 6 gigawatt power purchase agreement with the Tennessee Valley Authority and developer ENTRA1. Citigroup notes that even if an agreement is reached, NuScale will still need to secure original equipment manufacturer agreements to supply nuclear plant modules, leading to uncertainty in the timeline of the power purchase agreement and contract signing. The Citigroup report mentions that if the 6 gigawatt agreement is fully realized, NuScale may need to invest around $500 million in multiple phases with ENTRA1, but as of the second quarter of 2025, the company only has $4.2 billion in cash and equivalents. Analysts state, "We believe the market has overly high expectations for this deal, as the timeline may be longer than expected, and there is significant pressure on funding requirements. The deal is not set in stone, and the company lacks reliable short-term customers as backup, relying only on existing projects - which we believe is unlikely to change unless there are new entrants." Citigroup also maintains a "sell" rating on Plug Power, stating that their analysts believe that artificial intelligence and data center-related expenditures will not bring direct benefits to the company.