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Why Bloom Energy Stock Surged Another 10% This Morning

What happened

Well, the news is finally out.

Bloom Energy (NYSE: BE) shares had run upward by an impressive 40% since the end of October on no news. Friday morning, investors got to see its third-quarter earnings report, and Bloom Energy stock is making another run -- it's up by about 10% as of 11 a.m. EST.

The biggest surprise: The news wasn't even all that great.

Image source: Bloom Energy.

So what

Instead of breaking even on the bottom line as Wall Street had predicted, Bloom reported a net loss of $34.9 million for the third quarter -- about $0.50 per share. Granted, the predicted results had probably been focusing on some form of pro forma earnings, and Bloom's reported results were given as dictated by generally accepted accounting principles (GAAP) -- but still, it was a pretty sizable loss.

On the other hand, it was a marked improvement from the $78.6 million net loss it reported in Q3 last year (per S&P Global Market Intelligence data). And quarterly sales grew 23% year over year to $233.5 million, exceeding analysts' consensus prediction of $232 million and giving some support to those who will call these results an "earnings beat."

Now what

Can Bloom repeat or improve upon these feats in the year's final quarter? Analysts are optimistic for continued growth, forecasting a 20% year over year improvement in revenues to $256 million in Q4, and predicting that Bloom will be profitable in the quarter currently underway -- earning $0.04 per share according to Yahoo! Finance estimates.

For its part, however, Bloom gave no clear guidance as to what it expects to earn this quarter. Instead, it provided its usual "total installed system cost" estimate of about $4,400 per kilowatt, and "average sales price" estimate of about $6,070 per kilowatt on energy systems sold. About the most we can determine from those figures is that -- on a gross profit basis at least -- Bloom does expect to be profitable in Q4.

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Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.


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