NuScale Power (NYSE: SMR) was upgraded to Neutral from Underperform by BofA Securities, which lowered its price target to $28 from $34. Shares rose more than 6% intraday on Friday.

The analyst said the upgrade did not reflect a change in the firm's long-term view on small modular reactors, but rather acknowledged that the roughly 60% decline in NuScale's share price from its post-TVA announcement peak had brought valuation closer to a more balanced level.

BofA cited several factors weighing on near-term risk-reward, including the funding and timing mismatch embedded in the ENTRA1 Partnership Milestones Agreement, elevated near-term cash requirements, and incremental dilution that was expected to accelerate ahead of original equipment manufacturer revenue generation.

While the firm maintained its long-term deployment outlook of approximately 18 gigawatts of cumulative capacity through 2040, it said near-term cash flow cadence and equity overhang continued to keep the risk-reward profile balanced, supporting the move to a Neutral rating.