Shares of Nano Nuclear Energy Inc. NNE have surged an impressive 457.6% over the past year, outperforming the Zacks Alternative-Energy industry’s return of 65.9% as well as the broader Zacks Oils-Energy sector’s growth of 4.8%. It has also outpaced the S&P 500’s surge of 19.7% in the same period.

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With the rapidly increasing adoption of affordable clean energy worldwide as the preferred source of generating electricity, NNE rides on its progress toward successfully developing microreactor technologies. The company claims to be the first portable nuclear microreactor producer trading in the U.S. stock market.

A similar stellar performance has been delivered by other industry players, such as Bloom Energy BE, GEV Vernova GEV and Constellation Energy Corporation CEG, whose shares have surged 177.8%, 134.2% and 113.5%, respectively, over the past year.

With NNE riding high, individuals may rush to add the stock to their portfolio. However, before making any hasty decision, it would be prudent to take a look at the reasons behind the surge, the stock’s growth prospects as well as risks (if any) to investing in the same. The idea is to help investors make a more insightful decision.

What’s Been Pushing NNE Stock Higher?

Nano Nuclear Energy is developing smaller, cheaper, and safer advanced portable clean energy solutions utilizing advanced proprietary reactor designs, intellectual property and research methods to capitalize on the growth prospects of small nuclear power reactors. The company’s advanced nuclear microreactor products currently in development include “ZEUS,” a solid-core battery reactor, and “ODIN,” a low-pressure coolant reactor.  

NNE has been making notable progress in the development of its micronuclear technologies lately, which, in turn, has been boosting investors’ confidence in this stock, as evident from its shares’ solid performance at the bourses.

Evidently, in February 2025, NNE announced that it has filed four new separate utility patent applications with the United States Patent and Trademark Office related to its Annular Linear Induction Pump (“ALIP”) technology, which is a core technology in the development of advanced molten-salt and liquid-metal nuclear reactors.  

In the same month, the company revealed that it is establishing a purpose-built demonstration facility in Westchester County, New York, to demonstrate the operation and viability of several non-nuclear parts and components of NANO Nuclear’s four nuclear microreactors in development. The facility will also support the ongoing work on NANO Nuclear’s SBIR Phase III project for its ALIP technology.

In December 2024, NNE signed a definitive agreement to acquire select nuclear energy technology assets from Ultra Safe Nuclear Corporation and certain of its subsidiaries (collectively, “USNC”). The acquired assets include USNC’s patented Micro Modular Reactor system, which compliments NANO Nuclear’s own ‘ZEUS’ and “ODIN’ microreactors in development.

Earlier in September, NNE launched a new subsidiary, NANO Nuclear Space Inc. (“NNS”), to explore the potential commercial applications of the company’s developing micronuclear reactor technology in space. This expanded NNE’s business into the rapidly enhancing space exploration industry. 

What Lies Ahead for NNE Stock?

Increasing data center growth across the globe, along with rising electricity consumption, particularly in emerging nations and developing economies, backed by strengthening economic activities and prosperity in these countries, has been boosting global electricity demand. As the demand for electricity rises, so does the use of clean energy resources to generate that electricity. Amid this backdrop, a strong interest in small and medium nuclear power reactors has been witnessed in recent times, driven by a desire to reduce the impact of capital costs.

Therefore, once NNE’s cutting-edge portable microreactors hit the market and become commercially available, the company should be able to fetch notable revenues and profits over the long term, thereby boosting its bottom-line prospects.

However, the company has not started generating revenues yet. With NNE expecting to start providing nuclear service support and consultation services for the nuclear energy industry in 2025, we may not expect it to deliver any formidable top-line performance before the end of this year.

Meanwhile, it is continuing to incur significant operating expenses to successfully develop its microreactors and associated technologies. This, in turn, has been putting downward pressure on its bottom line. Moreover, there are some inherent uncertainties in the emerging small modular reactor (SMR) sector, in terms of economic viability, regulatory approvals as well as public acceptance, as they remain skeptical about nuclear power safety and waste management.  

So, the company's performance in terms of generating notable revenues and profit growth remains slick in the near term, which might be a cause of concern for its investors.

The year-over-year deterioration suggested by its first-quarter as well as full-year 2025 estimates reflects a similar picture. The unchanged revision observed in its near-term earnings estimate over the past 60 days further indicates that analysts are adopting a cautious approach in the stock of late.

Image Source: Zacks Investment Research

Image Source: Zacks Investment Research

Final Thoughts

To conclude, investors interested in NNE stock should wait for a better entry point, considering the year-over-year deterioration indicated by its earnings estimate and the company being in a pre-revenue state.

However, those who already have this Zacks Rank #3 (Hold) stock in their portfolio may continue to do so, considering its long-term growth prospect and impressive share price performance over the past year.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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