$0.02
$0.30
bear $0.02
base $0.20
bull $0.30
margin of safety $0.06
market price* $3.08
Business condition attached to the margin of safety
A signed implementation contract for its deep borehole disposal system, or a completed full-scale demonstration in Texas together with quarterly cash burn that has fallen materially below the current roughly $8 million per half-year.
Deep Isolation Nuclear is developing a way to dispose of high-level nuclear waste and spent fuel permanently by placing sealed canisters in deep boreholes more than a kilometre underground. It has a patented canister system developed with NAC International and is building a non-radioactive, full-scale, at-depth demonstration in Texas. It has never signed an implementation contract with a customer. The revenue it does have (about $6.1 million in 2025, down 13% from $7.1 million) comes from two places: Freestone, an environmental consulting subsidiary ($3.6 million of revenue and about $0.5 million of operating profit in 2025, versus $4.2 million and $1.0 million in 2024), and early-stage planning and appraisal work for the core disposal technology ($2.5 million of revenue but a segment operating loss of about $6.2 million). Four customers, including Department of Energy site-cleanup contractors and Oklo, supplied about $4.6 million of 2025 revenue. What the shares are worth today is mostly the cash in the bank. After the July 2025 merger and private placement the company held $27.4 million at the end of 2025, and it burned about $8.0 million in the first half of 2026, leaving roughly $19 million (equity was $19.7 million on June 30, 2026) against about 57.7 million shares, or about $0.33 per share. There is essentially no debt (a few thousand dollars of equipment leases). Owner earnings, meaning operating cash flow after working-capital swings, stock compensation and equipment spending, were negative: about $(0.02) per share in 2024 and $(0.11) per share in 2025. Because there is no positive earnings history to anchor on, the value comes from cash on hand less what the plan will spend, plus the small consulting business. The company's own plan calls for about $15.1 million of spending over the next twelve months (roughly $8.1 million on the Texas demonstration and $7.0 million of operating costs) and a similar amount the following year. The demonstration is a bet that has not yet paid off, and we give it no value: there is no contract, license or backlog behind the disposal technology, so nothing to credit. Base case, about $0.20 per share: the company spends its budgeted year on the demonstration and overhead, netting revenue of roughly $5.5 million against it (about $10 million of net cash out), leaving about $9 million of cash, plus the value of the Freestone consulting business held flat at roughly $0.4 million of after-tax earnings a year (about $3 million). No growth is credited. Freestone's revenue has fallen for a year, and beyond twelve months there is no named source of value, so nothing further is counted. Bear case, about $0.02 per share: spending continues at the current pace, cash runs out around late 2027 to 2028 with no follow-on contract, new shares must be sold at low prices or the business is wound down, and shareholders are left with little more than the value of a shrinking consulting arm. The business owes almost nothing, but its worth is close to zero. Freestone's earnings have already slipped from about $1.0 million to $0.5 million in a year, and it depends on a handful of federal customers. Bull case, about $0.30 per share: the extra merger-related legal, audit and travel costs that pushed overhead up from $4.1 million to $8.8 million in 2025 fall away, cash burn is held to about $7 million over the next year, leaving roughly $12 million of cash, and Freestone holds its 2025 earnings for a decade (about $4 million). We do not count a successful demonstration or new disposal contracts, since none is signed. In each case the business owes essentially nothing, so the value of the business and the value to shareholders are about the same. What would prove this too low: a signed implementation contract with a government or utility, or the Texas demonstration succeeding and generating paid follow-on work. What would prove it too high: cash burn continuing at the first-half 2026 rate (about $16 million a year) without new revenue, which would use up the cash in roughly 14 months. Some figures could not be reconciled exactly: the filing's four-customer concentration percentage (81%) does not match the dollar amounts (about 75% of revenue), and we used the dollar amounts. Dilution from options and warrants is not counted in the share total but would reduce per-share values slightly.