Shares of electricity and hydrogen company Bloom Energy (NYSE:BE) plummeted 11.8% in the morning session after Jefferies downgraded the stock to ‘Underperform’ from ‘Hold.’ The investment firm cited concerns over the company’s high valuation and uncertain long-term growth, warning that investor enthusiasm had outpaced the company’s fundamentals.
Analysts at Jefferies noted there was limited visibility into Bloom’s growth prospects beyond 2026 and pointed to “some early signs of over-exuberance” in the stock. Although Jefferies raised its price target to $31, this figure remains substantially below the stock’s current trading level, suggesting significant potential downside.
This downgrade compounds recent pressure on the stock. Just 24 hours earlier, shares fell 8% after BofA Securities maintained its ‘Underperform’ rating, despite raising its price target from $21.00 to $24.00. The persistent negative outlook from the bank appeared to outweigh the higher price target for investors.
These ratings come amid wider market concerns about Bloom’s fundamentals and reports of insider selling. While some analysts highlight the company’s potential in the AI data center power market, particularly following a deal with Oracle, the cautious assessments from major financial institutions are weighing heavily on sentiment.
Bloom Energy shares are known for their volatility, with 67 daily moves greater than 5% over the last year. Despite the recent declines, the stock remains up 186% since the beginning of the year, though it is trading 22.6% below its 52-week high. An investment of $1,000 in the company five years ago would be valued at $4,568 today.
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