BE - Bloom Energy: Sell The Rally On Persistent Business Headwinds (Rating Downgrade)

2024-05-22 22:31:15 ET

Summary

• Bloom Energy's shares have been on a tear after being highlighted as a potential AI data center demand beneficiary.
• Following a 40% rally since the end of last week, the company took the chance to address its closest debt maturity with an up to $287.5 million convertible debt offering.
• However, the company continues to face a number of headwinds that have resulted in lower-than-expected bookings and are not likely to go away anytime soon.
• Two weeks ago, Bloom Energy reported disappointing Q1/2024 results, with revenues below expectations and substantial cash burn.
• With forward estimates looking overly optimistic, I am downgrading the company's stock from "Hold" to "Sell" and would advise investors to consider taking profits following the recent rally.

Note:

I have previously covered Bloom Energy Corporation ( BE ), so investors should view this as an update to my earlier articles on the company. ...

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