Bloom Energy (BE.US) received a $5 billion collaboration, prompting Jefferies Financial Group Inc. to raise its target price to $53 but maintain an "underperform" rating.

Investment bank Jefferies Financial Group Inc. recently raised its target price for fuel cell manufacturer Bloom Energy (BE.US) from $31 to $53, but maintained a "underperform" rating on the stock. The bank explained that the recent partnership agreement between Bloom Energy and Bruker Corporation Field Asset Management (BAM.US) was the main reason for the increase in the target price for the stock. It was reported that on October 13th, Bloom Energy announced a $5 billion strategic partnership with Bruker Corporation Field Asset Management, officially becoming the preferred on-site power supplier for Bruker Corporation Field Asset Management's global artificial intelligence factory. The two companies will jointly design and deliver artificial intelligence factories globally, including a site in Europe to be announced by the end of the year. Under the agreement, Bruker Corporation Field Asset Management will invest up to $5 billion to deploy Bloom Energy's advanced fuel cell technology to support its AI infrastructure layout. This partnership is positioned by Bruker Corporation Field Asset Management as the first investment in a dedicated AI infrastructure strategy, focusing on expanding large AI factories, power solutions, computing infrastructure, and strategic capital partnerships. Despite raising the target price for Bloom Energy based on the partnership with Bruker Corporation Field Asset Management, Jefferies Financial Group Inc. remains cautious and continues to monitor the clarity of the joint venture's profit model. The fourth quarter will be a key observation point for investors, as Bloom Energy is likely to disclose its order backlog. Ideally, these orders will include significant sales shares for 2026 and 2027. Jefferies Financial Group Inc. analysts stated, "We have cautiously raised expectations for Bloom Energy following its partnership with Bruker Corporation Field Asset Management, but we still need to clarify the joint venture's profit structure and its actual impact on Bloom Energy's cash flow. Furthermore, we expect the fourth quarter to be a critical milestone, as the company will disclose order backlogs - ideally including a significant portion of sales for 2026 and 2027. The timing of project implementation remains crucial in meeting investors' high expectations." Data shows that Bloom Energy has become one of the top performing stocks for 2025, with a cumulative gain of over 495% this year. Over the past year, the company has transitioned from a volatile stock related to the Clean Energy Fuels Corp. industry to a favorite in the AI field. Its fuel cells are seen as a solution to the increasing power demand in AI, as these devices can be deployed off the grid and rapidly increase power generation. Therefore, the market expects it to play a crucial role in supplying power to AI data centers. In the financial report released at the end of last month, Bloom Energy reported that its revenue in the third quarter increased by 57% year-on-year to $519 million, surpassing market expectations of $428 million; adjusted earnings per share were $0.15, exceeding market expectations of $0.10; adjusted EBITDA was $59.05 million, better than market expectations of $46.02 million; operating profit margin was 1.5%, compared to -2.9% in the same period last year; free cash flow was $7.37 million, compared to -$83.76 million in the same period last year. Additionally, Bloom Energy announced plans to expand capacity, aiming to achieve a capacity of 2 gigawatts of fuel cells per year by the end of 2026, doubling its annual revenue level compared to 2025.