I don't blame you if you haven't heard about NuScale Power (SMR 5.01%) before -- after all, it's a young company founded in 2007 and went public in 2022. The stock, however, was down 69% through the end of 2023 before it dramatically rebounded this year. In May alone, the stock jumped a whopping 50.5%, according to data provided by S&P Global Market Intelligence.

Ironically, NuScale Power reported a 75% drop in its year-over-year revenue because of the loss of a contract and a 35% rise in net loss for its first quarter last month. Why did the stock go parabolic in May, then? It turns out that investors expect NuScale Power to benefit from the U.S. government's moves to boost the local nuclear industry.

A bet on nuclear energy

NuScale Power has developed a small modular reactor (SMR) nuclear technology powered by modules that can generate carbon-free nuclear energy for various end uses, including electricity generation, hydrogen production, desalination, and powering data centers.

So when President Joe Biden signed the Prohibiting Russian Uranium Imports Act into law in mid-May to ban the import of uranium from Russia, nuclear energy stocks surged. Uranium is a key fuel to power nuclear reactors, and part of the government's plans include pumping $2.7 billion to ramp up domestic nuclear fuel production.

With the government also calling nuclear energy "the way of the future" as it strives to build a low-carbon economy, investors were quick to lap up shares of companies involved in nuclear energy in any way. NuScale Power is one such stock that rode investors' enthusiasm last month.

Should you buy NuScale Power stock?

NuScale Power's technology looks promising, with the company also claiming its SMR technology to be the first and only such technology to have its design certified by the U.S. Nuclear Regulatory Commission. NuScale recently won a contract from Standard Power, a provider of infrastructure services for data centers, to develop two SMR-powered facilities in Ohio and Pennsylvania that'll deploy 24 NuScale Power modules and generate roughly 2 gigawatts of clean energy.

NuScale Power is still in the research and development stage and has yet to commercialize its technology. The company, however, says it is close to commercial deployment and is focused on advancing revenue-generating projects while securing new orders. NuScale Power also doesn't have any debt, which is notable for a start-up.

All of that may sound impressive, but investors may want to exercise caution when buying NuScale Power stock, as a company that's yet to sell and monetize its first product remains a speculative bet. Presently, whatever little revenue NuScale Power generates is for providing engineering and licensing services to potential customers. The stock, though, has already rallied 162% so far this year, as of this writing.