Bloom Energy Shares Drop
Bloom Energy Shares Drop Nine Percent Amid Oracle Project Concerns and Profit-Taking
Anonymous
Bloom Energy shares fell roughly 9% on September 28 after a sharp rally, as investors took profits following the end of buying tied to the company’s additions to major stock indexes. Selling also reflected concerns about Oracle’s force majeure notice related to Project Jupiter, a New Mexico data center expected to use Bloom fuel cells, and potential project delays; Oracle and the developer said the project remains on schedule and financial commitments are unchanged. Investors were also focused on a lead-plaintiff deadline in a securities lawsuit alleging misleading disclosures about Bloom’s scandium supply chain, while rising Treasury yields pressured growth stocks. One valuation analysis described the shares as substantially overvalued, while RBC reiterated its outperform rating and $335 price target, above the reported share price; broader analyst views were mixed, with a consensus rating of Moderate Buy.
Key Points
1
Bloom shares had gained 273.8% over the previous year before the September 28 decline, and company insiders had sold $162.9 million worth of stock over the prior 12 months.
2
Bloom’s force majeure-related concerns included a condition that Oracle could defer rent if Project Jupiter misses its 2028 target; Bloomberg also reported that about $18 billion in construction loans tied to the campus were trading below 90 cents on the dollar.
3
Reports cited permitting and natural-gas pipeline delays at Project Jupiter as additional risks that could push fuel-cell deliveries and related revenue recognition into later quarters.
4
Bloom reported quarterly earnings of $0.78 per share, beating the $0.39 consensus estimate, and revenue of $1.07 billion versus expectations of $826.13 million; revenue was up 165.5% year over year.
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