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Bloom Energy Corporation (NYSE:BE): Are Analysts Optimistic?

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. On 31 December 2022, the US$4.4b market-cap company posted a loss of US$301m for its most recent financial year. 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.

See our latest analysis for Bloom Energy

According to the 23 industry analysts covering Bloom Energy, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2024, before generating positive profits of US$125m in 2025. The company is therefore projected to breakeven around 2 years from today. How fast will the company have to grow each year in order to reach the breakeven point by 2025? Working backwards from analyst estimates, it turns out that they expect the company to grow 73% year-on-year, on average, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

earnings-per-share-growth
earnings-per-share-growth

Underlying developments driving Bloom Energy's growth isn’t the focus of this broad overview, however, take into account that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

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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 in investing in the loss-making company.

Next Steps:

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 compiled a list of relevant aspects you should look at:

  1. 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.

  2. 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.

  3. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

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