Cautious Hold Rating for Bloom Energy Amid Market Optimism and Revenue Uncertainty

Maheep Mandloi, an analyst from Mizuho Securities, has initiated a new Hold rating on Bloom Energy (BE).

Maheep Mandloi’s rating is based on a combination of factors that influence Bloom Energy’s market position and future prospects. The company is recognized for its innovative fuel cell technology that offers a cleaner alternative to traditional energy sources, which positions it well in the growing data center market. However, despite these advantages, the stock has experienced a significant rise due to the AI theme, which may not be sustainable in the short term.
Another reason for the Hold rating is the uncertainty surrounding the conversion of safe harbor orders into actual revenue, which adds a layer of risk to the company’s financial outlook. While Bloom Energy has the potential to expand its production capacity significantly, the current visibility on delivering the projected safe harbored product revenue is limited. Additionally, the company’s valuation is already high, reflecting investor optimism, which suggests limited immediate upside potential. Therefore, while Bloom Energy has promising long-term prospects, the current market conditions and uncertainties warrant a more cautious approach, justifying the Hold rating.

In another report released on March 3, Wells Fargo also maintained a Hold rating on the stock with a $22.00 price target.

Based on the recent corporate insider activity of 38 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of BE in relation to earlier this year.