Mackenzie Tatananni

Shares of Bloom Energy popped on Wednesday following an upgrade by J.P. Morgan. Call it a Trump Bump.

Bloom stock surged 17% to $28.40, on pace for its highest close since January, and the largest same-day percentage increase since November 2024, when the clean-energy firm reached a supply pact with American Electric Power, according to Dow Jones Market Data.

The double-digit gains came after analysts led by Mark Strouse upgraded Bloom stock to Overweight from Neutral, and raised the target price to $33 from $18.

Bloom specializes in fuel cells that produce electricity using natural gas or hydrogen. Under President Donald Trump's sweeping tax-and-spending bill, which was signed into law last Friday, fuel cells once again qualify for a tax credit under the Internal Revenue Code.

Bloom's fuel cells were previously eligible for the Section 48E tax credit, better known as the Clean Energy Investment Credit, until Jan. 1, when new tech-neutral tax credits took effect.

In J.P. Morgan's view, the credit should drive pricing power with data-center clients while boosting demand from more price-sensitive customers. "As competing gas-turbine pricing and lead times remain elevated, we believe the tax credits for fuel cells can push hesitant [Bloom] customers over the finish line, and expect order activity to increase accordingly," the firm wrote.

The analysts believe revenue should take off in fiscal 2026 compared with the 19% growth implied at the midpoint of the company's fiscal 2025 guidance.

That's not to say there aren't risks to their bullish thesis. The 48E tax credit for fuel cells begins in January 2026, which could cause order delays out of 2025. While Bloom issued its fiscal 2025 guidance assuming no tax credit, some customers could opt to delay installation into 2026 to qualify, the analysts argued.

Moreover, Bloom has yet to select a permanent chief financial officer following the abrupt exit of Daniel Berenbaum in May. The company's future financial chief may choose to focus less on profit versus growth compared with those in the past, J.P. Morgan argued.

While the company "has a lot to do in the next two to three years" to scale up and expand sales capability, J.P. Morgan remains upbeat about Bloom's growth prospects. The One Big, Beautiful Bill incentive was a welcome surprise.

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com

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July 09, 2025 15:01 ET (19:01 GMT)

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