Bloom Energy reported a 138% jump in quarterly revenue to $1.2 billion, with operating income rising from $7.8 million to $225.4 million, and raised its full-year revenue outlook to $4.4 billion–$4.6 billion, yet the stock has fallen more than 40% from its high. The author attributes the decline to two concerns: operating cash flow of negative $27 million, $153.5 million in capital expenditures that pushed free cash flow to negative $181 million, and a high valuation. At about $210 per share, the stock trades at nearly 65 times expected earnings, versus 19–21 times forward earnings for the S&P 500 and Nasdaq-100. The author says the nearly 40% discount is not a bargain, since 25% annual earnings growth with a multiple compressing to 25 times would put the share price near $250, roughly a 3%–4% annualized return. The author also cites Rystad Energy's estimate that fuel cell investments for data centers could rise from $2.8 billion last year to $30 billion by 2030.
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