Bloom Energy Stock Soars: What's Going On?

Bloom Energy Corp. (NYSE:BE) shares are booming Monday. RBC Capital Markets argued that the fuel cell maker is still well positioned after the election. Here’s what you should know.

• Bloom Energy stock is surging to new heights today. Why is BE stock surging?

Bloom Energy Stock Rises as RBC Defends Outperform

RBC Capital Markets analyst Christopher Dendrinos reiterated an Outperform rating and a $335 price target. RBC’s note says the midterms revealed growing resistance to data centers and louder demands for oversight, but that Bloom keeps a favorable position.

Dendrinos wrote, “We do not think datacenters are dead.” Dendrinos expects projects to involve more community input and more careful site selection, which slows construction and adds short-term uncertainty for Bloom.

Besides fast delivery, Bloom offers cleaner exhaust, a lower noise profile and zero water consumption, Dendrinos said, and those traits carry more weight as developers court local support. RBC left its estimates unchanged. The $335 target applies a 22 times multiple to 2028 earnings, roughly double the two-year forward average. RBC’s best case is $428 a share, and its worst case is $74.

RBC Sees Limited Texas Fallout for Bloom

Bears may overstate the Texas risk, Dendrinos said. Inexpensive grid power and light regulation have sent developers to other suppliers there, so Bloom has little business in the state and has only just started delivering its initial fuel cells.

Governor-elect Gina Hinojosa said in an interview that the incoming governor does not want to ban data centers and prefers rules that give communities more say, Dendrinos noted. A poll found 79% of Texans favor limits on data center growth, mostly over power bills, water, outage risk, noise and pollution, concerns fuel cells are built to ease.

Dendrinos expects a moratorium and the continuing ERCOT and PUCT grid-connection review, called Batch Zero, to slow projects in the near term. Slower grid hookups may nudge developers toward making their own power at the site, which plays to Bloom’s strengths.

Canada Funding and NTT DATA Deal Support Bloom

Dendrinos also cited two positives abroad. Canada’s budget sets aside a proposed $6 billion over six years, beginning in 2028-29, for new low-carbon power technologies such as solid oxide fuel cells. The budget does not say how much would go to fuel cells. Bloom’s biggest overseas project to date is an NTT DATA deal to install 900 megawatts of on-site power at data centers worldwide.

Risks include competition from gas turbines, penalties for missed performance targets, reliance on a few big customers and supply chain disruptions.

BE Shares Are Flying

BE Price Action: Bloom Energy shares were up 13.21% at $196.12 at the time of publication on Monday, according to Benzinga Pro.

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