Bloom Energy Corporation (NYSE:BE) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Bloom Energy Corporation designs, manufactures, sells, and installs solid-oxide fuel cell systems for on-site power generation in the United States and internationally. The US$5.6b market-cap company posted a loss in its most recent financial year of US$302m and a latest trailing-twelve-month loss of US$130m shrinking the gap between loss and breakeven. As path to profitability is the topic on Bloom Energy’s investors mind, we’ve decided to gauge market sentiment. In this article, we will touch on the expectations for the company’s growth and when analysts expect it to become profitable.
Check out our latest analysis for Bloom Energy
Bloom Energy is bordering on breakeven, according to the 27 American Electrical analysts. They anticipate the company to incur a final loss in 2024, before generating positive profits of US$20m in 2025. The company is therefore projected to breakeven around 12 months from now or less. At what rate will the company have to grow in order to realise the consensus estimates forecasting breakeven in under 12 months? Using a line of best fit, we calculated an average annual growth rate of 61%, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.
Underlying developments driving Bloom Energy’s growth isn’t the focus of this broad overview, though, bear in mind that typically a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
Before we wrap up, there’s one issue worth mentioning. Bloom Energy currently has a debt-to-equity ratio of over 2x. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, and the company has considerably exceeded this. Note that a higher debt obligation increases the risk around investing in the loss-making company.
There are key fundamentals of Bloom Energy which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Bloom Energy, take a look at Bloom Energy’s company page on Simply Wall St. We’ve also put together a list of pertinent factors you should look at:
Valuation: What is Bloom Energy worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Bloom Energy is currently mispriced by the market.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Bloom Energy’s board and the CEO’s background.
Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
This article was originally published here.
