Shares of a small energy company soar a quarter after AI agreement

Quotes of small energy player Bloom Energy jumped nearly 25% on the premarket on Oct. 13 after announcing a deal with investment firm Brookfield, CNBC writes. It supplies fuel cells for data centers that serve artificial intelligence systems. At the moment, Bloom Energy shares were trading 30% above their last closing level.

Brookfield plans to invest up to $5 billion to deploy Bloom Energy's technology, the first step in its strategy to provide large data centers with power and computing infrastructure, the channel notes.

Bloom Energy's fuel cells provide localized power that can be deployed quickly because it is not dependent on centralized power grids. The company says it has already installed hundreds of megawatts of such systems under agreements with American Electric Power, as well as data center operators Equinix and Oracle.

In total, since the beginning of the year, Bloom Energy's capitalization has jumped by more than 291%, and over the year it has grown by 730%. In late September, a Jefferies analyst downgraded the company to a sell recommendation, pointing to its overvaluation and uncertain prospects. He believes that investor euphoria over its deal with Oracle to build AI data centers is not fundamentally supported and requires too aggressive a pace of development. Earlier in mid-September, Morgan Stanley called the agreement with Oracle a watershed for Bloom Energy.

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