Bloom Energy Stock Surges on Rival News, But Is It a Buy?

Bloom Energy stock rose 6% on little to no news, while rivals Ballard and Plug reported news this week. Ballard got a price target hike, but Plug reported a big net loss. Bloom is a very expensive fuel cell stock with a P/E ratio of 400 and three times more debt than cash on its balance sheet. The stock may be overvalued and considered a sell rather than a buy.

Bloom Energy (NYSE: BE) stock surged by 6% on Wednesday, July 1, 2025, despite the absence of significant company-specific news. The stock's performance was seemingly influenced by developments involving its rivals, Ballard Power (NASDAQ: BLDP) and Plug Power (NASDAQ: PLUG). While Bloom Energy's stock price rose, analysts remain cautious about the company's valuation and financial health.

Ballard Power reported a near-50% price target hike from Roth Capital, reflecting improved sentiment in the sector. However, the company missed revenue targets in Q2 2025 and faced challenges such as high capital costs and slow commercialization. Plug Power, on the other hand, reported a significant net loss in Q2, dampening investor enthusiasm [1].

Bloom Energy's stock has a high price-to-earnings (P/E) ratio of 400 and a substantial amount of debt relative to its cash position. The company's valuation appears rich, with a P/E ratio that is significantly higher than the average for the industry. Moreover, the stock has only earned $0.11 per share over the past 12 reported months, making it a costly investment [1].

Investors considering Bloom Energy should be aware of the company's high valuation and financial risk. While the stock's recent performance may be attributed to positive sentiment around its rivals, there is no specific news indicating a significant improvement in Bloom Energy's prospects. The Motley Fool Stock Advisor analyst team has not recommended Bloom Energy as one of the top 10 stocks for investors, suggesting caution [1].

In contrast, Ballard Power Systems, despite its challenges, has shown resilience in certain segments and is positioning itself for long-term growth. The company's goal of achieving cash flow positivity by 2027 hinges on disciplined execution and cost-cutting efforts. However, the path to profitability remains uncertain, and investors should closely monitor the company's progress in reducing costs and diversifying revenue streams [2].

For investors considering Bloom Energy, it is essential to weigh the risks against the potential rewards. The company's high valuation and debt position make it a speculative investment, and the lack of specific news driving the stock's recent performance should be a cause for concern. Investors should conduct thorough research and consider seeking professional advice before making investment decisions.

References:

[1] Rich Smith. (2025). Why did Bloom Energy stock pop on little to no news today? The Motley Fool. Retrieved from https://finance.yahoo.com/news/why-did-bloom-energy-stock-193750494.html

[2] AINvest. (2025). Ballard Power Systems: Hydrogen Horizon Strategic Momentum High-Stakes Transition. AINvest. Retrieved from https://www.ainvest.com/news/ballard-power-systems-hydrogen-horizon-strategic-momentum-high-stakes-transition-2508/