Bloom Energy shares have come under pressure this week, sliding to a low of $254 on Thursday before recovering to around $267. The stock remains roughly 25% below its 2025 high, and technical analysts are flagging the emergence of an island reversal pattern on the daily chart—a bearish signal that could point to further downside.
Project Jupiter headwinds mount
The recent volatility stems from growing challenges around Project Jupiter, a large data center development in New Mexico that has drawn significant local opposition. On Thursday, Oracle, the project's developer, issued a force majeure notice related to power supply, the developer, and a unit of Blue Owl. Force majeure clauses typically relieve parties from contractual obligations when unforeseen events disrupt performance. In this case, Oracle has faced resistance from residents concerned about water usage and the project's power generation plans.
Meanwhile, banks that provided financing for the project have struggled to offload roughly $18 billion in debt to the market, adding to the uncertainty. Despite these hurdles, Oracle maintains that Project Jupiter remains on schedule and does not expect delays.
Project Jupiter is a critical component of Bloom Energy's growth strategy, as Oracle plans to deploy Bloom's fuel cells—which run on natural gas—at the site. Environmental groups in New Mexico have voiced opposition to the use of natural gas, further complicating the project's outlook.
Fundamentals remain strong
Despite the project-specific concerns, Bloom Energy's underlying business continues to perform well. In the second quarter, the company reported revenue of $1.06 billion, a 165.5% surge from the $401.2 million recorded in the same period last year. Analysts expect this momentum to persist, with consensus estimates projecting another 105% revenue jump in the current quarter to $1.06 billion. For the full year, revenue is forecast to reach $4.12 billion, up 103% from $2.02 billion in the prior year.
This robust growth has kept most sell-side analysts bullish on the stock. UBS has a price target of $300, Susquehanna and BTIG both see $298, and JPMorgan is even more optimistic at $314.
Risks to consider
However, investors should weigh several risks. Data center project cancellations are on the rise across the United States, which could impact Bloom Energy's pipeline. Additionally, the stock trades at a forward price-to-earnings ratio of 98.55, far above the sector median of 19, leaving little room for execution missteps.
Technical outlook
On the daily chart, Bloom Energy shares have been consolidating since a small gap formed on September 8. This consolidation is now forming an island reversal pattern, a classic bearish reversal indicator. The Relative Strength Index (RSI) is also showing bearish divergence, making a series of lower lows. If the pattern plays out, the stock could retreat to the $200 level before resuming its longer-term uptrend.
This article is for informational purposes only and does not constitute financial advice.
