Oklo Inc. and Pinnacle West Capital Corporation are two key players in the regulated electric utilities sector, each with distinct approaches to energy production and innovation. Oklo focuses on cutting-edge fission power plant technology and nuclear fuel recycling, while Pinnacle West operates a diverse energy portfolio serving over a million customers in Arizona. This comparison will guide you through their strengths to identify the most compelling investment opportunity. Let’s explore which company could enhance your portfolio.
Table of contents
Companies Overview
I will begin the comparison between Oklo Inc. and Pinnacle West Capital Corporation by providing an overview of these two companies and their main differences.
Oklo Inc. Overview
Oklo Inc. focuses on designing and developing fission power plants to deliver reliable, commercial-scale energy across the United States. Founded in 2013 and based in Santa Clara, California, the company also offers used nuclear fuel recycling services. Oklo operates in the regulated electric sector with a market cap of approximately 16.5B USD and a workforce of 120 employees.
Pinnacle West Capital Corporation Overview
Pinnacle West Capital Corporation provides retail and wholesale electric services primarily in Arizona through its subsidiary, Arizona Public Service Company. The firm manages generation, transmission, and distribution using diverse energy sources including coal, nuclear, gas, oil, and solar. Founded in 1985 and headquartered in Phoenix, Arizona, Pinnacle West serves about 1.3M customers with a market cap near 10.7B USD and 6,400 employees.
Key similarities and differences
Both companies operate in the regulated electric industry within the utilities sector and are listed on the NYSE. Oklo specializes in innovative nuclear fission power and fuel recycling, while Pinnacle West offers a broad energy mix including traditional and renewable sources over an extensive transmission and distribution network. Pinnacle West is more established with a larger customer base and workforce compared to the younger, more specialized Oklo.
Income Statement Comparison
The table below presents a side-by-side comparison of the key income statement metrics for Oklo Inc. and Pinnacle West Capital Corporation for the fiscal year 2024.
| Metric | Oklo Inc. | Pinnacle West Capital Corporation |
|---|---|---|
| Market Cap | 16.5B | 10.7B |
| Revenue | 0 | 5.12B |
| EBITDA | -52.5M | 2.07B |
| EBIT | -52.8M | 1.11B |
| Net Income | -73.6M | 609M |
| EPS | -0.74 | 5.35 |
| Fiscal Year | 2024 | 2024 |
Income Statement Interpretations
Oklo Inc.
Oklo Inc. reported no revenue from 2021 to 2024, with net income consistently negative and worsening from -$5.2M in 2021 to -$73.6M in 2024. Margins remain unfavorable, reflecting continuous operating losses and no gross profit. The latest year shows a sharp increase in expenses, causing a significant decline in earnings per share and widening net losses.
Pinnacle West Capital Corporation
Pinnacle West Capital exhibited steady revenue growth from $3.8B in 2021 to $5.1B in 2024, with net income rising from $619M to $609M. Margins are favorable overall, with a strong gross margin above 40% and an EBIT margin over 21% in 2024. The most recent year saw revenue growth accelerate by 9.1%, alongside improved EPS and net margin, despite slightly increased operating expenses.
Which one has the stronger fundamentals?
Pinnacle West Capital demonstrates stronger fundamentals with consistent revenue growth, positive net income, and favorable margins over the period. Oklo Inc. shows persistent losses, no revenue generation, and deteriorating profitability metrics, indicating weaker financial health. Pinnacle West’s stable earnings and efficient cost management contrast with Oklo’s unfavorable income statement trends.
Financial Ratios Comparison
The table below presents a side-by-side comparison of key financial ratios for Oklo Inc. and Pinnacle West Capital Corporation, reflecting their most recent fiscal year data for 2024.
| Ratios | Oklo Inc. (OKLO) | Pinnacle West Capital Corporation (PNW) |
|---|---|---|
| ROE | -29.3% | 9.0% |
| ROIC | -19.2% | 3.5% |
| P/E | -28.5 | 15.9 |
| P/B | 8.4 | 1.43 |
| Current Ratio | 43.5 | 0.59 |
| Quick Ratio | 43.5 | 0.42 |
| D/E | 0.005 | 1.64 |
| Debt-to-Assets | 0.005 | 0.42 |
| Interest Coverage | 0 | 2.68 |
| Asset Turnover | 0 | 0.20 |
| Fixed Asset Turnover | 0 | 0.25 |
| Payout Ratio | 0 | 65% |
| Dividend Yield | 0% | 4.1% |
Interpretation of the Ratios
Oklo Inc.
Oklo’s financial ratios reveal several weaknesses, including negative returns on equity (-29.35%) and invested capital (-19.23%), alongside an unfavorable net margin at 0%. The company’s extremely high current ratio (43.47) suggests excess liquidity but may also indicate inefficiency. Oklo does not pay dividends, consistent with its negative earnings and reinvestment focus in nuclear technology development.
Pinnacle West Capital Corporation
Pinnacle West shows mixed ratios: a favorable net margin of 11.88% and dividend yield of 4.09%, but weaker returns on equity (9.01%) and invested capital (3.48%), and a low current ratio (0.59). The company maintains a dividend policy supported by a payout ratio that reflects steady shareholder returns despite some leverage and operational efficiency concerns.
Which one has the best ratios?
Pinnacle West’s overall ratios are slightly unfavorable but more balanced with some positive profitability and dividend yield, while Oklo’s ratios are predominantly unfavorable with negative profitability and returns. Pinnacle West’s established dividend and moderate leverage contrast with Oklo’s high liquidity and reinvestment profile, suggesting differing risk and growth profiles.
Strategic Positioning
This section compares the strategic positioning of Oklo Inc. and Pinnacle West Capital Corporation based on Market position, Key segments, and Exposure to technological disruption:
Oklo Inc.
- Emerging player in regulated electric with 16.5B market cap and moderate beta
- Focus on designing fission power plants and nuclear fuel recycling
- Faces industry disruption through innovative nuclear technology
Pinnacle West Capital Corporation
- Established utility with 10.7B market cap, lower beta, serving 1.3M customers
- Diversified energy generation including coal, nuclear, gas, oil, and solar
- Operates with traditional and renewable generation, exposed to energy transition challenges
Oklo Inc. vs Pinnacle West Capital Corporation Positioning
Oklo pursues a concentrated strategy in advanced nuclear technology with a smaller workforce, while Pinnacle West maintains a diversified portfolio across multiple energy sources and a large customer base. Pinnacle West’s scale and diversification offer operational breadth; Oklo’s innovative focus targets emerging energy solutions.
Which has the best competitive advantage?
Both companies show a very unfavorable moat status with declining ROIC trends, indicating value destruction. Neither currently demonstrates a sustainable competitive advantage based on their return on invested capital relative to their cost of capital.
Stock Comparison
The past year saw Oklo Inc. exhibiting a strong bullish trend with significant price gains, while Pinnacle West Capital Corporation also showed positive momentum but with more moderate appreciation.
Trend Analysis
Oklo Inc. experienced a robust bullish trend over the past 12 months with a 610.11% price increase, though recent months indicate a deceleration and a short-term decline of -22.59%. Volatility remains high with a standard deviation of 39.02.
Pinnacle West Capital Corporation showed a bullish trend with a 31.14% gain over the year, but recent performance slightly weakened with a -3.31% drop. The stock exhibits lower volatility, indicated by a 6.87 standard deviation.
Comparing both, Oklo Inc. delivered substantially higher market performance over the year despite recent deceleration, outperforming Pinnacle West Capital Corporation in overall price appreciation.
Target Prices
Analysts present a clear target price consensus for Oklo Inc. and Pinnacle West Capital Corporation, reflecting moderate upside potential.
| Company | Target High | Target Low | Consensus |
|---|---|---|---|
| Oklo Inc. | 150 | 95 | 125.67 |
| Pinnacle West Capital Corporation | 115 | 85 | 96.33 |
Oklo Inc.’s consensus target price of 125.67 USD suggests a potential upside from the current 105.31 USD stock price. Pinnacle West’s consensus at 96.33 USD indicates a modest gain compared to its 89.07 USD market price.
Analyst Opinions Comparison
This section compares analysts’ ratings and grades for Oklo Inc. and Pinnacle West Capital Corporation:
Rating Comparison
Oklo Inc. Rating
- Rating: C+, considered Very Favorable by analysts.
- Discounted Cash Flow Score: 3, indicating a Moderate rating.
- ROE Score: 1, rated Very Unfavorable for equity returns.
- ROA Score: 1, rated Very Unfavorable for asset returns.
- Debt To Equity Score: 5, rated Very Favorable for low risk.
- Overall Score: 2, a Moderate overall financial standing.
Pinnacle West Capital Corporation Rating
- Rating: C+, also considered Very Favorable by analysts.
- Discounted Cash Flow Score: 1, indicating a Very Unfavorable rating.
- ROE Score: 3, rated Moderate for equity returns.
- ROA Score: 3, rated Moderate for asset returns.
- Debt To Equity Score: 1, rated Very Unfavorable for high risk.
- Overall Score: 2, a Moderate overall financial standing.
Which one is the best rated?
Both Oklo and Pinnacle West share the same overall rating and score, but Oklo scores better on discounted cash flow and debt-to-equity, while Pinnacle West performs better on return on equity and assets. Their ratings reflect different financial strengths and risks.
Scores Comparison
Here is a comparison of the Altman Z-Score and Piotroski Score for Oklo Inc. and Pinnacle West Capital Corporation:
Oklo Inc. Scores
- Altman Z-Score: 339.4, indicating a safe zone
- Piotroski Score: 2, classified as very weak
Pinnacle West Capital Corporation Scores
- Altman Z-Score: 0.73, indicating distress zone
- Piotroski Score: 4, classified as average
Which company has the best scores?
Oklo Inc. exhibits a significantly higher Altman Z-Score, placing it in a safe zone compared to Pinnacle West’s distress zone. However, Pinnacle West has a stronger Piotroski Score, suggesting better financial strength on that measure.
Grades Comparison
Here is a detailed comparison of the recent grades assigned to Oklo Inc. and Pinnacle West Capital Corporation:
Oklo Inc. Grades
The following table summarizes recent grades from recognized grading companies for Oklo Inc.:
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Seaport Global | Upgrade | Buy | 2025-12-08 |
| UBS | Maintain | Neutral | 2025-12-03 |
| B of A Securities | Maintain | Neutral | 2025-11-12 |
| B. Riley Securities | Maintain | Buy | 2025-11-12 |
| Wedbush | Maintain | Outperform | 2025-11-12 |
| B of A Securities | Downgrade | Neutral | 2025-09-30 |
| Seaport Global | Downgrade | Neutral | 2025-09-23 |
| Wedbush | Maintain | Outperform | 2025-09-22 |
| Wedbush | Maintain | Outperform | 2025-08-14 |
| Wedbush | Maintain | Outperform | 2025-08-12 |
Oklo Inc. grades show a mix of Buy and Outperform ratings, with some recent neutral assessments, indicating a generally positive but cautiously monitored outlook.
Pinnacle West Capital Corporation Grades
The following table presents the latest grades from established grading firms for Pinnacle West Capital Corporation:
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| UBS | Maintain | Neutral | 2025-12-17 |
| Keybanc | Downgrade | Sector Weight | 2025-12-12 |
| Keybanc | Maintain | Overweight | 2025-10-15 |
| UBS | Maintain | Neutral | 2025-10-10 |
| Barclays | Maintain | Equal Weight | 2025-10-07 |
| Argus Research | Maintain | Buy | 2025-09-30 |
| Morgan Stanley | Maintain | Equal Weight | 2025-09-25 |
| UBS | Maintain | Neutral | 2025-09-12 |
| Mizuho | Downgrade | Neutral | 2025-09-09 |
| Barclays | Maintain | Equal Weight | 2025-08-13 |
Pinnacle West Capital Corporation’s grades predominantly range from Neutral to Equal Weight, with occasional Buy and Overweight ratings, reflecting a more cautious consensus.
Which company has the best grades?
Oklo Inc. holds a stronger overall grading consensus, with multiple Buy and Outperform ratings, suggesting greater analyst confidence. Pinnacle West Capital Corporation’s consensus leans more toward Hold and Neutral grades, implying a more reserved outlook. This difference may influence investor sentiment and risk assessment when considering portfolio inclusion.
Strengths and Weaknesses
Below is a comparative overview of the strengths and weaknesses of Oklo Inc. and Pinnacle West Capital Corporation based on their latest financial and strategic data.
| Criterion | Oklo Inc. | Pinnacle West Capital Corporation |
|---|---|---|
| Diversification | Limited product/service range; primarily nuclear innovation | Diversified energy portfolio; electric and transmission services, wholesale energy |
| Profitability | Negative ROIC (-19.23%), net margin 0%, value destroying | Positive net margin (11.88%), but ROIC (3.48%) slightly below WACC; slightly unfavorable profitability |
| Innovation | Focus on advanced nuclear technology but with declining returns | Traditional utility company with stable, incremental innovation |
| Global presence | Limited, primarily US-focused nuclear tech | Regional US presence focused on regulated operations |
| Market Share | Emerging player, small market footprint | Established regional utility with significant market share in electric services |
Key takeaways: Oklo Inc. is an innovative but currently unprofitable company with a narrow focus and declining value creation. Pinnacle West shows steady revenue and positive margins but faces challenges in ROIC and debt levels, leading to only a slightly unfavorable overall financial outlook.
Risk Analysis
Below is a comparative table outlining key risks for Oklo Inc. and Pinnacle West Capital Corporation as of 2024:
| Metric | Oklo Inc. | Pinnacle West Capital Corporation |
|---|---|---|
| Market Risk | Moderate (Beta 0.77) | Lower (Beta 0.54) |
| Debt level | Very Low (D/E 0.01) | High (D/E 1.64) |
| Regulatory Risk | High (Nuclear energy sector) | Moderate (Energy regulation in Arizona) |
| Operational Risk | High (Early-stage, low asset turnover) | Moderate (Established infrastructure) |
| Environmental Risk | Moderate (Nuclear fuel recycling impact) | Moderate (Coal, nuclear, gas operations) |
| Geopolitical Risk | Low (US-based, focused market) | Low (US-based, regional focus) |
In summary, Oklo faces significant operational and regulatory challenges due to its innovative nuclear technology and early-stage status, despite very low debt, while Pinnacle West holds higher financial risk with substantial debt and moderate regulatory exposure but benefits from established operations and a lower market volatility profile. Investors should weigh Oklo’s growth potential against its financial and operational uncertainties, whereas Pinnacle West’s risks stem more from leverage and market dynamics in regulated utilities.
Which Stock to Choose?
Oklo Inc. (OKLO) shows an unfavorable income evolution with stagnant revenue and sharply declining profitability over 2021-2024. Its financial ratios reveal mostly unfavorable metrics, including negative returns on equity and invested capital, despite low debt and a very favorable debt-to-equity score. The company’s rating is moderate overall but reflects very unfavorable returns and valuation ratios.
Pinnacle West Capital Corporation (PNW) demonstrates a favorable income growth trend with improving gross and net margins and positive earnings growth over 2020-2024. Its financial ratios are slightly unfavorable overall, with moderate returns and mixed debt metrics, though showing some stable profitability and a moderate rating. The company is in financial distress per Altman Z-score but maintains average Piotroski strength.
Considering the ratings and comprehensive financial evaluations, Oklo’s very unfavorable profitability and negative income growth contrast with Pinnacle West’s generally favorable income evolution and more balanced ratios. Investors prioritizing growth potential might find Oklo’s recent bullish price trend appealing, while those seeking more stable income and moderate profitability could view Pinnacle West as a less volatile option given its track record.
Disclaimer: Investment carries a risk of loss of initial capital. The past performance is not a reliable indicator of future results. Be sure to understand risks before making an investment decision.
Go Further
I encourage you to read the complete analyses of Oklo Inc. and Pinnacle West Capital Corporation to enhance your investment decisions:
