RBC Capital cuts Fluence Energy price target to $25 from $27

Published 15/01/2025, 21:24
RBC Capital cuts Fluence Energy price target to $25 from $27

In the context of upcoming financial disclosures, Fluence Energy is in advanced discussions regarding contracts worth around $1.5 billion, which could be announced alongside fiscal first-quarter 2025 earnings on February 6. With an overall Financial Health score of "FAIR" from InvestingPro and current analysis suggesting the stock is undervalued, these developments have the potential to act as catalysts, narrowing the guidance range and possibly leading management to project greater assurance in the company's financial outlook.Get access to the comprehensive Pro Research Report and detailed financial analysis for Fluence Energy, along with 1,400+ other stocks, exclusively on InvestingPro.

Fluence Energy, which specializes in energy storage technology and services, is expected to reiterate its guidance for 2025. With current revenue of $2.7 billion and a robust growth rate of 21.7% in the last twelve months, the company shows strong market momentum.

However, RBC Capital warns of potential downside risks stemming from more guarded commentary on pricing in the latter half of 2025 and into 2026, as competition in the sector intensifies. Conversely, an upside could emerge from the announcement of a significant order that would secure the revenue outlook for the second half of 2025.

The company's financial performance and future prospects are closely tied to several factors, including pricing dynamics, demand for its products, and liquidity. The guidance for 2025 is notably dependent on the latter half of the year, and investors are keen to see a robust order book in early 2025 to gain confidence in the company's projections. Currently, the existing backlog accounts for approximately 65% of Fluence Energy's revenues.

In the context of upcoming financial disclosures, Fluence Energy is in advanced discussions regarding contracts worth around $1.5 billion, which could be announced alongside fiscal first-quarter 2025 earnings on February 6. With an overall Financial Health score of "FAIR" from InvestingPro and current analysis suggesting the stock is undervalued, these developments have the potential to act as catalysts, narrowing the guidance range and possibly leading management to project greater assurance in the company's financial outlook.Get access to the comprehensive Pro Research Report and detailed financial analysis for Fluence Energy, along with 1,400+ other stocks, exclusively on InvestingPro.

In other recent news, Fluence Energy has announced the resignation of Senior Vice President and Chief Product Officer Rebecca Boll, effective January 31, 2025. The company has initiated a search for her successor, with interim oversight of the Product organization by Vice Presidents Mark Berger and Freddy Reyes Falck. In terms of financial performance, Fluence Energy reported a 22% revenue growth in the last twelve months, reaching $2.7 billion. The company also plans to offer $300 million in convertible senior notes due in 2030, aimed at funding general corporate purposes and upgrading a battery cell production line.

In analyst updates, Canaccord Genuity reaffirmed its Buy rating for Fluence Energy with a price target of $34, while Jefferies maintained a Buy rating but reduced the price target to $22. Piper Sandler set a target of $20, maintaining a neutral stance, and Baird revised its target to $24 due to potential margin pressure concerns.

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