Dividend Stocks

Bloom Energy (BE) Stock Pops on Agreement With Perenco

Shares of solid oxide fuel cell specialist Bloom Energy (NYSE:BE) jumped on the midweek session. This comes off the back of a key agreement with Anglo-French firm Perenco, a leading independent hydrocarbon company. The former entity’s Bloom Energy Server — to be delivered late this year — will be installed at a property in Dorset, England. Subsequently, BE stock gained nearly 4% in the late afternoon hours on the broader advanced energy solution implications.

According to the accompanying press release, the aforementioned platform will be installed at Wytch Farm, the largest onshore oil field in western Europe. Bloom’s solid oxide fuel cell technology will help support Perenco’s baseload requirements. According to information provided by researchers at the University of Calgary, baseload power represents the minimum amount of electric power needed to supply an electric grid at any given time.

Notably, per the public disclosure, the agreement between Bloom and Perenco represents the first deployment of Bloom fuel cell technology in the U.K. “This is an important step that will demonstrate how our solid oxide fuel cell technology supports the resilience and sustainability goals of our energy-intensive clients,” said Tim Schweikert, senior managing director of International Business Development at Bloom Energy.

BE Stock Pops on the Burgeoning Solid Oxide Fuel Cell Market

For its part, Perenco emphasized its pioneering spirit in innovation and long-term energy investments. “Today’s announcement is another important step as we continue to reduce our emissions wherever we work. We look forward to a successful initial deployment at Wytch Farm and to then expanding the use of the technology into other global operations sites,” remarked Perenco CEO Benoit de la Fouchardiere.

Indeed, Fouchardiere’s expansionary ambitions fundamentally bode very well for BE stock. Although shares managed to ink a strong performance on Wednesday, they’re still down more than 18% on a year-to-date basis. Over the trailing one-year period, BE is down by a similar magnitude, indicating that Bloom still attempts to establish stability in its business. Therefore, today’s announcement could go a long way.

Moreover, patient investors may be able to enjoy significant rewards via BE stock. According to the Office of Fossil Energy and Carbon Management in the U.S., the innovation commands broad relevancies. “Fuel cells are an energy user’s dream: an efficient, combustion-less, virtually pollution-free power source, capable of being sited in downtown urban areas or in remote regions that runs almost silently and has few moving parts.”

Just as enticingly for BE stock, the market is relatively fresh. According to Grand View Research, the global solid oxide fuel cell market size reached a valuation of $463.7 million in 2022. However, experts project the segment to expand at a compound annual growth rate (CAGR) of 41.5% between 2023 and 2030. At the forecast period culmination, the sector should ring up sales of $7.1 billion.

Analysts Are Overall Bullish

From TipRanks, Wall Street analysts peg BE stock as a consensus moderate buy. This assessment breaks down as eight buys, five holds and zero sells. On average, the experts’ price target lands at $25.08, implying slightly over 60% upside potential.

On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare.