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Investing.com - Morgan Stanley has raised its price target on Bloom Energy Corp. (NYSE:BE) to $85.00 from $44.00 while maintaining an Overweight rating on the stock. The stock, currently trading at $67.02, has already delivered an impressive 201% return year-to-date, according to InvestingPro data.
The firm cited Oracle’s recent massive bookings beat as a catalyst for the upgrade, noting that Oracle reported $332 billion in new bookings in the first quarter, exceeding estimates of approximately $100 billion. This development follows Bloom Energy’s July announcement of an agreement to power Oracle AI data centers with its fuel cells. The company’s strong market position is reflected in its robust revenue growth of 22.7% over the last twelve months, with InvestingPro analysis indicating multiple positive growth indicators among its 20+ available tips.
Morgan Stanley highlighted that data center demand for power remains extremely strong, with the market for power supply quickly tightening. The potential power shortfall is expected to exceed 40 GW in the coming years, compared to Bloom Energy’s current 1 GW annual capacity, offering significant growth potential. With a market capitalization of $15.68 billion and a current ratio of 4.99, the company appears well-positioned to capitalize on this opportunity, though InvestingPro’s Fair Value analysis suggests the stock may be trading above its intrinsic value.
The firm also raised its bull case for Bloom Energy to $185, representing a potential 175% upside, based on the company’s ability to quickly expand manufacturing capacity. According to Morgan Stanley, Bloom can ship and install products within 90 days and double its manufacturing capacity to 2 GW in less than six months.
Morgan Stanley noted that traditional power sources face constraints, with regulated utilities reporting 5-7 year wait times for new data center connections, while alternative power equipment suppliers are experiencing 2-3 year wait times for certain units.
In other recent news, Bloom Energy has seen multiple analyst firms raise their price targets significantly. Wells Fargo increased its price target from $38 to $65, citing growing demand driven by artificial intelligence and the company’s unique position as a major U.S. fuel cell provider. BMO Capital also raised its price target to $75 from $35, reflecting increased confidence in Bloom Energy’s long-term demand prospects. Similarly, RBC Capital doubled its price target to $75, highlighting the company’s growth potential in the energy sector.
In leadership developments, Bloom Energy announced the appointment of Aaron Hoover as the head of business and corporate development. Hoover, previously with Morgan Stanley, brings over two decades of experience in energy and finance. Meanwhile, Jefferies has maintained its Hold rating and a $24 price target, despite a recent stock rally. The firm noted several potential catalysts for this movement, including CEO interviews and industry developments.
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