Bloom Energy是关键的AI硬件投资标的，增长强劲且利润率改善，但客户高度集中于Oracle以及利润率上行空间有限，使其更像短期动量交易而非基本面买入；公允价值在90至178美元之间，股票AI目标价为124美元。

People have also been very very excited about Bloom Energy. This one has really been retracing down a lot and they have very large turbines. I'm just kidding. They don't have turbines. Uh they're a um they're actually a fuel cell play and they they have pretty good pricing power on those fuel cells because you can set them up in like three to four months substantially faster than you can set up natural gas turbines. And I don't really understand fully how it works, but I think it's very fascinating that you could basically chemically turn natural gas into energy uh without just lighting it on fire. Uh which is that's seems kind of cool. Anyway, that's uh that's been a big uh data center uh component because hey, I could stand up a data center way faster. You know, it takes years to build uh like a you know, your your very own natural gas facility, let alone to get the the permitting for it. It's crazy. So, uh we'll see.

Okay, so revenue for the company is more than doubled, right? So hop in here. This is we're up divided by 401. We're up 2.65 X on revenue. Cost of revenue is 7097 / 294 2.4x. So um some pricing power there, right? like the the revenue is accelerating faster but not much faster. Product costs went up actually that's negative PP right there. Ooh 2.99x on product costs up. So really service stabilized installation went up divided by 38.2. Oh no installation's only up 33 38%. and service is up a fraction as well, 14%. Uh, so product basically what's happening here is they're able to sell it for a higher price, but the costs are also higher. So they're able to sell for higher prices, but costs are higher at a higher rate than uh price increases. Uh and um install/service not growing as fast makes uh uh gross margin uh look like it's improving because you know obviously the cost of installing those aren't skyrocketing. The labor stays pretty similar. GNA I mean this is fine. 173 divided by 110 more marketing everything. This is fine. and 57% here uh suggest pricing power as well. So that's pretty good. Yeah. Uh let's look at the forecast on on the valuation for them just to see what the suits are forecasting and then we can actually jump in on uh what we think this company's worth.

So, EPS projected end of 2026 is 255. Forward growth four years is 8475. That's phenomenal. Uh plus 5829 plus 2897 + 253 equals divided by 4 equals I mean projecting 49% growth obviously tapering off to about 25. So call it 50% growth on four years projected tapering to 25%. So if I now uh let's see here margins gross profit their margins are still in like the 35% range. It's very good uh even though they're a manufacturer. So, let's say you could go with like a I don't know, just go with like a 24 maybe. Maybe maybe not that high. Maybe like a 22 peg. That could be interesting. So, let's see what this puppy's worth. Um, if I go with 2.55* 2.4 4 uh times 50 I get to about 306 which is pretty good suggests upside uh at 2.4 peg. Okay. So the let's see here trying to think of growth forecast for this. Okay, that's at 24. If I now run it at 25% forward growth uh at 24. Oops. Um 25. Dang it. Okay. 2.55. Well, I mean it should be half. So it'll be like 150 bucks times uh 2.4 4* 25% growth puts it at about $153. So that's interesting. Let's see here. So it really comes down to where you think growth will stabilize for the company, which that also then plays into the anthropic situation because you know if if they could keep booming and the services they're providing, great. The forecast growth we have yeah 50% that sounds right is a manufacturer. So it's possible that could be too aggressive and then forecasts on earnings. All right. So let's do this is this we'll call it an aggressive you know aggressive more software level you know 24 peg right cuz software high margin software two high margin software two four to to three uh maybe slightly above three for software I might be a little aggressive with this with and it also depends on how these margins sustain because if the margins compress because what's driving revenue let's find out is it pricing I mean obviously unit growth is happening but let's go look a little bit revenue uh let's see here revenue revenue oh they have a partnership with Oracle that's also Very interesting. And Oracle got options to buy 3 million shares at 113. Oh, lucky them. Okay, good for them. So, they're nicely up on those warrants. That's very good. So, they made a good buy there. The AI infrastructure fund is a little bit circular. We know that. Here's their debt. Their debt's a 0% convertible. Are you kidding me? Oh, that's so nice, dude. Look at that. $3 billion uh of a convertible. That's three months ended here. Yeah. And then they paid off a bunch of They actually paid off a bunch of their zero convertible. Wow. Kind of surprised by that. But anyway, that's great for an interest point of view. Okay, somewhere here I should see a little bit more on their revenue commentary, but I think I missed it. I think I missed it. Sub, I'm already at subsequent events. I mean, every company does this a little differently, but cap calls. We saw the oracle piece, the loans, the joint venture. We saw that. This is all balance sheet crap. That was Oracle. Oh, I really must have missed it. They don't exactly make these documents really easy to read. No, it must still be down there. Stock comp, contingencies, income taxes, subsequent events, credit facility, operating income. There we go. Oh, I just saw it and I screwed it up. Come on, Kevin. Operating activities. uh higher level of new deposits mix of system lower proportion of projects without significant upfront building buildings. Ah interesting. So I always think that's interesting. The more of these upfront deposits that's not necessarily good. I dislike too many upfront deposits because it suggests most of the W is already on the cash flow statement, right? like you're already pricing in. Oh, look at their cash flow. But if those were upfront deposits, that's less ideal, right? Deposits, the timing of vendor payments, that's for their cash flow. Inventory increased and their cash flow yields already very low. Delivery and installations revenue. Wow, it's all the way down here is where they talk about it. total revenue uh was driven by higher product revenue and an increase in services revenue. Yeah, they're not going to talk about why increase was primarily to a stronger demand for our power solutions to meet the time to power needs of the growing market. Significant deployment for larger AI customer and multiple projects through join venture with Brookfield. Well, that's the circular revenue part. Yeah, I mean but that that makes sense. AI projects Okay. So, cost cost of revenue, cost of product. Ah, the stock comp was in there because we saw that stock comp get boosted, but they're actually seeing more manufacturing efficiency. That's interesting. So, stock comp hit the cogs as well as I wonder if they build that into like com sales commissions, right? That is interesting. Okay. So, if I now go to the income statement and if I give them a lower margin like let's go with um if you go with a a 1.6 peg ratio, right? So like you know one peg dirty you know 7% margins 1.6 call that your 35% net let's say let's run it at that let's go 2.55 * 2 oh sorry times uh 1.6 peg times 50% forecast growth I'm at 204 255 time 1.6 at just 25% get to about 100. So, you know, if if we price this the upside here, you have to get pretty bullish now to get to 300. I get why there's a lot of excitement, but to and it was at 300, but to really justify that 300, you'd probably have to see higher margins and and this spend just continue. So, there's definitely some risk baked into this one, especially now with the Nancy Pelosi trade. Yeah, people get really excited about uh you know, the insider trades. But that's interesting. Let's go look at their earnings call briefly.

Yeah, Bloom Energy social media volume quadruples. Yeah, cuz everybody's talking about Nancy Pelosi. That's hilarious. Nancy. Okay, let's get that beamed over. Okay, Bloom Energy earnings call. I write that down, too. I think that's kind of funny. Volume for X. And then let me run this through really quick. Okay. Stock bloom. So, let me see here. Okay, that's fine. One sec. All right, sorry. Okay, good. That's done. So, now let's look at that earnings call and see what juice we have in here. I really want to see like order forecasts. So, cuz I want to see that growth rate. I'm going to type in forecast. No. How about the word growth? Okay, we do have the word growth. Tailwinds of rapid TAM growth and increasing market share. That's really good, right? So, bullish TAM. Then I've got consequently we have visibility and conviction of the growth trajectory into 2026 and beyond. You control the cost of the model T blah blah blah. With that in mind, go through some of the numbers, whatever. Margin expansion, which should continue to drive margin expansion. Yeah, that's the key. They're already guiding that. That's what you need to really push this higher or or the valuation higher. But that's still very good. It just probably justifies closer to a 167 peg as a manufacturer. Operating margin of 21%. What is this? That's gross margin. Operating margin closer to 21% as our guidance. Well, hold on a sec. What do we got over here? Income statement. I've got gross profit. Yeah, there's that 30. Well, that's a little what 355 divided by 1065. That's 33 on the gross. So 33.3 gross guiding 35%ish. Okay. And then on the net they're bringing about 198 divided by 1065 18.5% net. Ah yeah yeah that's you know that that's why the forecast peg it just can't be this high. Uh, so it might even be lower, right? Cuz they're actually closer to 20%. 20%, you know, might be closer to call it 14. Let me just run that math really quick. I'm curious about that. 255 * 1.4 * 50 178 178.2 two and then 255 14 what? Yeah. Half 89. So it it really depends on the multiple you give this. Uh what peg do you want to give it? Yeah. 18% net. They're guiding 21%. Okay, that's growth. Let's look at 8 years ago. 21% negative 21. Yeah. Yeah. See, like they literally talk talk about margin swings a lot too. They know it as well. And so you're on you're on an upswing right now and that's why the stock is performing so well. Let's look at the uh bookmarks months of AI compute blah blah blah. Okay. Legacy backlogs are until 2029, right? This is why we need more Bloom Energy backlogs. Customers can get air permits with our technology faster than they can with combustion alternatives. Yeah, cuz you're talking about months instead of years. Okay. Resilient supply chain, whatever. Okay. What do we got here? That's the EPS growth guidance mix. Okay. No, no. We've seen this. Don't care. That's just pretty boring. Okay. So, nothing ridiculously exciting there. Obviously, a lot of trade attention is going to come into Nancy Pelos's disclosure.

Uh, Bloom Energy has only recently been positive on net margin. That's true. I mean, they lost money. 21 22 23 24 25. Wow. Okay. Let me see what else I can get here. I'm just looking at some historical data. Consensus estimates for net margin do take them up to about 22% by 2028. That's kind of where you top out. Okay. Let's write that down. So income we've had negative margins negative margins since you know 2021 to 2025 just went positive top out at 22% in 2028. So there's a limit here. These are pricey to manufacture fuel cells. So it's it's kind of hard to actually it's like you're not you're never going to turn into like a software style margins, right? You're a manufacturer. That's just the way it is.

Okay. So, Bloom, Bloom Energy, drop their data in here and we can really break this down a little bit. All right. Boom. Send all that through. Okay. So, Bloom, I would argue that it's a really critical hardware play coming out of negative margins, right? So critical AI hardware play uh coming out of net negative margins. Uh the upside to margin is limited due to high uh manufacturing costs. We see some of that in the income statement already. Therefore, uh justifies a lower peg than say an apple.

Bloom, I would argue that it's a really critical hardware play coming out of negative margins, right? So critical AI hardware play uh coming out of net negative margins. Uh the upside to margin is limited due to high uh manufacturing costs. We see some of that in the income statement already. Therefore, uh justifies a lower peg than say an apple.

So, 40% gross margin versus like 35. You're getting there. You're getting there. Okay. All right. I think that's a fair comparison. So, I would almost call him like the Apple of AI infrastructure to some extent minus the the software part. So I got to rewrite this. Uh Bloom Energy BE uh gross margins on products are approaching Apple. Apple last Q gross margins are uh 40%. on products. Bloom uh gross margins are on products 593 divided by 935 63.4 36.5 36.5% on a product. So it's actually similar to Apple uh benefit for Apple uh so call it a PEG booster is the extra services revenue that Apple has which Bloom Energy really doesn't. So you know Apple's going to get that extra ARR that Bloom just won't.

So currently um currently it's trading for what are we currently trading for? We're trading at like call it what 205 or something like that. See the current valuation energy. Yeah. 205. Okay. 205 divided by forecast of 255 in earnings. Currently trading for ADX earnings with 50% average 4-year growth 25% tapered at end of that four years. So the way I would usually do the math is that right now it's trading for 80 divided by 50. trading for about a 1.6 peg. That's, you know, without without a big services component, that's fair. You know, the the upside is limited. Upside uh is limited outside momentum, right? So, I'd go pricing power. Uh yes, though. Um, so I call it greenish greenish uh stock comp boost somewhat hit pricing power the potentially on sales incentives, right? Okay. the balance sheet momentum and then the valuation valuation for the company is yellow you know fairish. Okay. Momentum on the week chart is mid-range so call it yellow. And then the balance sheet, they just paid off a bunch of debt, which was very useful. So, it's greening, you know, greening. Uh they just paid off uh chunk of debt, their 2030 convertibles. Okay. So, yeah, I mean, it's it's fair what's happening. I I don't think it would be something that I would jump into just because I think it is very m momentum driven uh short-term pop uh heavily due to Nancy Pelosi 15K share plus options uh disclosure July 24. That day the stock traded uh between 184 to 215 I think it was. You know we saw it get down to 185 today.

Okay. So let's put that into bloom and let's make sure we also have the current estimates for it. Bloom Energy. Uh just a little bit higher. Cool. All right. So that's Bloom.

Huh. Okay. We might do like a little summary on that. But I want to look at Apple for a moment. How is See in Apple. Think about Apple. I mean Bloom's growth is insane. Apple's growth is significantly slower, but that's already factored into the EPS growth level because just for comparison, let's put Apple in as a comparison.

Uh where be is closer to fair and and a lot of that I think is probably just hype on the CEO transition.

Okay. So, gross margin, let's see. Yeah, se Apple I know is okay. That's about a 75% gross margin on the services. And that's the thing that Bloom doesn't have because the more products Apple sells, the more that becomes a sales pitch for the services. So, you're really much more concentrated on the manufacturing side that creates some risk and that's probably why Apple is pricing so much stronger. Uh, right. So Apple's pricing uh reflects that ARR the products enable you know in my opinion.

So the Oracle deal they have is the vast majority of their Q2 revenue. That's really interesting. The Oracle deal is probably one of the biggest risks. So, did they say that uh concentration uh geographic customer risk? Here we go. Yeah. Yeah. Yeah. Look at that. During the three months, revenue from two customers, the second of which is a related party, note 11, accounted for 44% and 21% of our revenue. Wow. During the prior six months, revenue from one customer accounted for 73% of our revenue. Oo, that's really heavy on their AI fund and uh Oracle. This is almost a supplier to Oracles drunken debt. That makes me more bearish. Uh, I'm going to write that down. That's that's a big point. So, probably probably the scariest line. Okay. So this is 73% of rev in last 6 months one customer Oracle and um 44% of Q1 was Oracle. Sorry that was Q2. So Oracle is drunk spending and Bloom picks it up. You know, they're picking up the dollars.

Here it is. Nancy Pelos's periodic transaction report, which is a fancy way of saying she bought the dip and it was probably her husband, but it doesn't matter because dang, they just spent millions of dollars buying Bloom Energy and Intel. In this, we're going to break down everything that you need to know about Bloom Energy, but it's worth noting they spent millions of dollars. I see at least $15,000 worth of share uh purchases. I see call options uh that were purchased with a strike price of $100. So well in the money for a year out. Uh they made these purchases on July 24th. So as usual, it's been 2 months. Oh, actually no, it's been exactly 30 days. It's been exactly 30 days since the transaction. So of course, we get the news late. If you keep in mind what was going on a month ago, you'll remember that that was exactly when Leo pulled was getting Leo folded. Who knows what kind of insider information info Nancy Pelosi had, but that's okay because on the 24th, the stock traded between $183 and a high of $218. That's literally in the strike range for where Bloom Energy is trading now at $25. So, is it a good deal? And should you buy the stock, what even the heck do they do? Okay, let's keep this really simple because obviously it is well down from its high of $351. That is a fall of 61% from peak in the value of this company. So what drove that fundamentals momentum? The answer is both. So here's the thing about Bloom Energy. Bloom Energy is a fuel cell provider that gets fueled with natural gas and then chemically converts it to energy. So, it's a little bit different than just like lighting it on fire like a you know a gas engine for example. Uh but what's fascinating about Bloom Energy is they've had really bad margins and because of this data center boom their margins are blowing up and when you look at their income statement it's really good right now. Now it didn't used to be. They had negative margins in 21, 22, 23, 24, 25. You get the idea. But now look at this. Their revenue has 2.65xed to over a billion. Their gross profit is sitting at about 33 to 35ish%. They're they've literally got gross margins on their product that are like 37ish%. And then of course you've got like install and some of these other lower margin things. uh they bring about 18.5% to the bottom line now and in their earnings call they're guiding about 21% that they can bring to the bottom line and about 34% that they can bring to the top. Now why does 34% on gross margin matter for the full year? Well, because that's really similar to Apple, which is kind of exciting because you know Apple's a pretty high margin business. We know their stuff isn't exactly the cheap for a pretty penny, but if you go to the Apple financial statements, you'll see that their products also sell for about a 37% gross margin. Now, the thing

So, this is actually more than just a data center bet. It's all It's like a bet on Oracle.

about Bloom Energy, but it's worth noting they spent millions of dollars. I see at least $15,000 worth of share uh purchases. I see call options uh that were purchased with a strike price of $100. So well in the money for a year out. Uh they made these purchases on July 24th. So as usual, it's been 2 months. Oh, actually no, it's been exactly 30 days. It's been exactly 30 days since the transaction. So of course, we get the news late. If you keep in mind what was going on a month ago, you'll remember that that was exactly when Leo pulled was getting Leo folded. Who knows what kind of insider information info Nancy Pelosi had, but that's okay because on the 24th, the stock traded between $183 and a high of $218. That's literally in the strike range for where Bloom Energy is trading now at $25. So, is it a good deal? And should you buy the stock, what even the heck do they do? Okay, let's keep this really simple because obviously it is well down from its high of $351. That is a fall of 61% from peak in the value of this company. So what drove that fundamentals momentum? The answer is both. So here's the thing about Bloom Energy. Bloom Energy is a fuel cell provider that gets fueled with natural gas and then chemically converts it to energy. So, it's a little bit different than just like lighting it on fire like a you know a gas engine for example. Uh but what's fascinating about Bloom Energy is they've had really bad margins and because of this data center boom their margins are blowing up and when you look at their income statement it's really good right now. Now it didn't used to be. They had negative margins in 21, 22, 23, 24, 25. You get the idea. But now look at this. Their revenue has 2.65xed to over a billion. Their gross profit is sitting at about 33 to 35ish%. They're they've literally got gross margins on their product that are like 37ish%. And then of course you've got like install and some of these other lower margin things. uh they bring about 18.5% to the bottom line now and in their earnings call they're guiding about 21% that they can bring to the bottom line and about 34% that they can bring to the top. Now why does 34% on gross margin matter for the full year? Well, because that's really similar to Apple, which is kind of exciting because you know Apple's a pretty high margin business. We know their stuff isn't exactly the cheap for a pretty penny, but if you go to the Apple financial statements, you'll see that their products also sell for about a 37% gross margin. Now, the thing that's different about Apple that gives Apple a big premium is they sell services at about a 70 to 75% gross margin that Bloom Energy doesn't. So the Apple products that are selling for about 37% margin. So you know you sell $100 worth of stuff, $37 goes into the business that they can then spend on research and GNA or advertising or whatever. Then they pay taxes on it. Then they get their net right. They got $37 billion $37 out of 100 left. That is great because it doesn't just give you the $37. It leads more people to sign up for subscriptions to iCloud or, you know, whatever the the life software that they have for music or the subscriptions for any of their other products, storage included. That's a big W for Apple because it's really high margin. Bloom, on the other hand, you have to think of it as just mostly the vast majority of it being the higher gross margin manufacturing side. The reason that's important is because it caps their net. We're really not expecting to see the net income for Bloom to really ever go beyond 25%. Because they don't have that service aside. They're still making things that cost a lot of money. And these fuel cells are great because you could stand them up in 3 to 4 months whereas, you know, a natural gas facility at a data center might take you somewhere around 3 to four years to stand up. So, there's been this huge boom in let's just use fuel cells to stand up our data centers so we could get up and running and lower our time to revenue on data centers, which is really important because guess the biggest risk for Bloom Energy, their main customer. So, this is customer concentration risk, which uh I think is a really big red flag. That's not to say I'm bearish on the company. We'll talk about a price target in just a moment, but they have got serious revenue concentration. 44% of their Q1 or their last quarter's revenue came from Oracle. And in the last 6 months, 73% came from Oracle. Oracle is, you know, the dirty sort of data center play whose credit default swaps continue to skyrocket because people think they're taking on so much debt. There's a high risk of default. Oracle stock has not exactly been doing them any favors either. If you look at Oracle stock peak to where it is now at 143 divided by 351, which is eerily the same almost the same top that you had um in in the mid 350s range over here for Bloom Energy. That's down nearly 60%. Uh and it's mostly because of the debt they're taking on. Well, who's picking up that debt? It's Bloom Energy, which is now getting a big momentum boost because of Nancy Pelosi. Intraday. It's up like 11% just intraday on this Nancy Pelosi disclosure riding right here at my 206 line which is a fib uh retracement line. Uh and maybe we'll be able to sustain that and break back up. But you could see since uh June after the Google and SpaceX suckening the stock has been falling. Why? It could be visibility into growth. And that's always what's really important about these companies is we try to forecast growth. See, Apple's growth isn't that high, but it's stable. Apple's growth is like 9% stable. And that means they're trading for about a 3.7 peg right now. In my opinion, Apple's actually about 40% overvalued right now because I like to combine, you know, 35 PE ratio divided by the growth and go, I don't want to pay that much for that growth. Now, there's hope that the CEO is going to help transition the company to more products and more AI revenues, but a lot of that hope is already priced in now, right? Bloom Energy, on the other hand, let's look at the forecast for Bloom Energy. So, if I want to go really aggressive on the upside and I give them a really juicy like closer to software level price to earnings growth level, I could take their forecast earnings per share of $2.55, give it a multiple of 2.4 4 times 50% growth, I get a 306 price target. But the problem is the growth that's going up to 50% is going to taper off, especially as Oracle buys fewer of these in the longer term, it's expected in four years, three and four years to taper down to 25%. And so if I run this at just 25% growth times a 24 multiple times their earnings per share today, my fair value today is actually 153. So at 205, you know, we're we're we're closer to this, but like what's my upside, right? My upside is expecting that this can keep booming and growing forever, but I'm really reliant on Oracle. So what that means is I need to expand to different customers. I need to sell to Oracle more. I don't want to bet on Oracle. Uh or I need my margins to go up. Margins, they're good, but we're already seeing some of the pressure here, right? revenue is up 2.6 times and product costs are up 2.9x. So costs are up higher than revenue. And they say part of that is because they had to pay an increase in stockbased compensation on their sales, which to me suggests that like their salespeople are grinding really hard to get those sales and contracts signed. And if I got to pay more than I'm able to increase the prices or revenue, then it just sort of makes me question like how long and sustainable is that revenue? So, I'm not saying this is a bad deal. I'm saying there's concentration risk. Uh there's a lot of momentum in it and the company is growing margins. I got to give them that. They do acknowledge that margin swings a lot. They say it over here. Hey, we've been negative. We went public eight years ago. In between that time, we've swung from negative to positive. There's so much going on uh in terms of changing, but we're really bullish on our total addressable market. We think there are massive tailwinds. we're going to be able to increase market share, get more customers. You know, maybe Oracle is just the start. They also have a related party that buys their own products. This is a fund that they basically operate in partnership with Brookfield Asset Management. And so, in some of their concentration risks, you'll actually see, hey, some of our sales went to a related party entity. That's their AI fund. And their AI fund naturally buys Bloom Energy products. But again in the last quarter that represented 21% of their revenue. So their own sort of circular financing was 21% of their revenue. Oracle was 44% in the last quarter. The quarter before that Oracle was even more. Right? So if you lose the circular part or you lose Oracle you lose a lot of that growth momentum that we're seeing. Now hopefully you could just land new customers. But that's the bet that you're making on this income statement. Now cash flow looks good. Cash flow yield a little low though. Okay. We've got about a 1% less than 1% cash flow yield. Uh you've got Palunteer is also about a 1% cash flow yield. Very different from a software stock that is going to be trading at uh you know like a 10% cash flow yield. An example of which might be like Salesforce. Salesforce was one of the buy alerts that we sent at about $163 per share. Remember you could always be part of that over at the meet Kevin membership. You get all the courses, every trade alert, every private liveream, all the alpha, the fundamental analysis, the technical analysis we do. So stuff like this on a daily basis in our course member liveream. Join us. Use coupon code J-Hole. Tax professional say this could be a tax write off as well. And uh use that coupon code before it expires on August uh 27th. So uh let's just continue and uh look at a little bit of their balance sheet. So their balance sheet is decent. We've got $2.6 billion in cash and I've got $800 million in bills to pay. So, I'm pretty decent on the balance sheet. I do have 2.4 in long-term, though, I will say those long-terms are mostly uh convertible liabilities for 2030 that have a 0% coupon. So, it's not like they're dying or drowning in debt here when they got a 0% loan. Basically, it's pretty good. So, there's a lot to be excited about when it comes to Bloom Energy. And I get it. I get the momentum. I think the technology is brilliant. I think it's really, really smart. uh but I do think there are some risk factors and so our stock AI tool uh which basically tries to use my brain and tune algorithms in combination with artificial intelligence gives you a couple forecasts. We'll look at both Apple and we'll look at Bloom Energy. So, Apple is very interesting because I calculated before I looked before I looked at the stock AI tab, I calculated um how much do I think Apple is worth and I run their peg at what I think a reasonable peg is like a 2 4 22 somewhere in there and I think Apple is overvalued to the tune of 40% was the estimate I came up with. My stock AI tool at mekevin.com shows me at a 45% downside for Apple. So, not really excited here just because so much hope is priced in. Maybe that growth rate will skyrocket though. And if the growth rate for Apple skyrockets on new products and foldable phone, then you could justify a higher fair value, a higher terminal fair value for this company. But we're really relying on growth and we're already we're not getting Apple for a discount to justify uh you know hedging against that growth right now. If I look at Bloom Energy, I sit at 124 with this target on stocki. Why? The reason we sit lower there is because the examples I gave you on the income statement were the more aggressive style pegs. I think 306 to 153 requires a higher net margin that this company is not going to achieve. So, more realistically, you're probably somewhere between, depending on what growth ratio you use, between 90 bucks to 178, which means for me, this is more of a short-term trade than it is a fundamental hedged buy at this point. Could be a momentum play, but that's my take on Bloom and Apple. Make sure to join us over at mekevin.com.

Bloom Energy, on the other hand, let's look at the forecast for Bloom Energy. So, if I want to go really aggressive on the upside and I give them a really juicy like closer to software level price to earnings growth level, I could take their forecast earnings per share of $2.55, give it a multiple of 2.4 4 times 50% growth, I get a 306 price target. But the problem is the growth that's going up to 50% is going to taper off, especially as Oracle buys fewer of these in the longer term, it's expected in four years, three and four years to taper down to 25%. And so if I run this at just 25% growth times a 24 multiple times their earnings per share today, my fair value today is actually 153. So at 205, you know, we're we're we're closer to this, but like what's my upside, right? My upside is expecting that this can keep booming and growing forever, but I'm really reliant on Oracle. So what that means is I need to expand to different customers. I need to sell to Oracle more. I don't want to bet on Oracle. Uh or I need my margins to go up. Margins, they're good, but we're already seeing some of the pressure here, right? revenue is up 2.6 times and product costs are up 2.9x. So costs are up higher than revenue. And they say part of that is because they had to pay an increase in stockbased compensation on their sales, which to me suggests that like their salespeople are grinding really hard to get those sales and contracts signed. And if I got to pay more than I'm able to increase the prices or revenue, then it just sort of makes me question like how long and sustainable is that revenue? So, I'm not saying this is a bad deal. I'm saying there's concentration risk. Uh there's a lot of momentum in it and the company is growing margins. I got to give them that. They do acknowledge that margin swings a lot. They say it over here. Hey, we've been negative. We went public eight years ago. In between that time, we've swung from negative to positive. There's so much going on uh in terms of changing, but we're really bullish on our total addressable market. We think there are massive tailwinds. we're going to be able to increase market share, get more customers. You know, maybe Oracle is just the start. They also have a related party that buys their own products. This is a fund that they basically operate in partnership with Brookfield Asset Management. And so, in some of their concentration risks, you'll actually see, hey, some of our sales went to a related party entity. That's their AI fund. And their AI fund naturally buys Bloom Energy products. But again in the last quarter that represented 21% of their revenue. So their own sort of circular financing was 21% of their revenue. Oracle was 44% in the last quarter. The quarter before that Oracle was even more. Right? So if you lose the circular part or you lose Oracle you lose a lot of that growth momentum that we're seeing. Now hopefully you could just land new customers. But that's the bet that you're making on this income statement. Now cash flow looks good. Cash flow yield a little low though. Okay. We've got about a 1% less than 1% cash flow yield. Uh you've got Palunteer is also about a 1% cash flow yield. Very different from a software stock that is going to be trading at uh you know like a 10% cash flow yield. An example of which might be like Salesforce. Salesforce was one of the buy alerts that we sent at about $163 per share. Remember you could always be part of that over at the meet Kevin membership. You get all the courses, every trade alert, every private liveream, all the alpha, the fundamental analysis, the technical analysis we do. So stuff like this on a daily basis in our course member liveream. Join us. Use coupon code J-Hole. Tax professional say this could be a tax write off as well. And uh use that coupon code before it expires on August uh 27th. So uh let's just continue and uh look at a little bit of their balance sheet. So their balance sheet is decent. We've got $2.6 billion in cash and I've got $800 million in bills to pay. So, I'm pretty decent on the balance sheet. I do have 2.4 in long-term, though, I will say those long-terms are mostly uh convertible liabilities for 2030 that have a 0% coupon. So, it's not like they're dying or drowning in debt here when they got a 0% loan. Basically, it's pretty good. So, there's a lot to be excited about when it comes to Bloom Energy. And I get it. I get the momentum. I think the technology is brilliant. I think it's really, really smart. uh but I do think there are some risk factors and so our stock AI tool uh which basically tries to use my brain and tune algorithms in combination with artificial intelligence gives you a couple forecasts. We'll look at both Apple and we'll look at Bloom Energy. So, Apple is very interesting because I calculated before I looked before I looked at the stock AI tab, I calculated um how much do I think Apple is worth and I run their peg at what I think a reasonable peg is like a 2 4 22 somewhere in there and I think Apple is overvalued to the tune of 40% was the estimate I came up with. My stock AI tool at mekevin.com shows me at a 45% downside for Apple. So, not really excited here just because so much hope is priced in. Maybe that growth rate will skyrocket though. And if the growth rate for Apple skyrockets on new products and foldable phone, then you could justify a higher fair value, a higher terminal fair value for this company. But we're really relying on growth and we're already we're not getting Apple for a discount to justify uh you know hedging against that growth right now. If I look at Bloom Energy, I sit at 124 with this target on stocki. Why? The reason we sit lower there is because the examples I gave you on the income statement were the more aggressive style pegs. I think 306 to 153 requires a higher net margin that this company is not going to achieve. So, more realistically, you're probably somewhere between, depending on what growth ratio you use, between 90 bucks to 178, which means for me, this is more of a short-term trade than it is a fundamental hedged buy at this point. Could be a momentum play, but that's my take on Bloom and Apple. Make sure to join us over at mekevin.com.

So their balance sheet is decent. We've got $2.6 billion in cash and I've got $800 million in bills to pay. So, I'm pretty decent on the balance sheet. I do have 2.4 in long-term, though, I will say those long-terms are mostly uh convertible liabilities for 2030 that have a 0% coupon. So, it's not like they're dying or drowning in debt here when they got a 0% loan. Basically, it's pretty good.

If I look at Bloom Energy, I sit at 124 with this target on stocki. Why? The reason we sit lower there is because the examples I gave you on the income statement were the more aggressive style pegs. I think 306 to 153 requires a higher net margin that this company is not going to achieve. So, more realistically, you're probably somewhere between, depending on what growth ratio you use, between 90 bucks to 178, which means for me, this is more of a short-term trade than it is a fundamental hedged buy at this point. Could be a momentum play, but that's my take on Bloom and Apple.

So that doesn't make Bloom Energy a bad company. It's a concentrated risk. Now that doesn't mean companies with concentrated risk are bad. Like it's just who's the counterparty? So in this case the counterparty is Oracle which credit default swaps are skyrocketing on.

We really want to see expansion to other data centers rather than just Oracle.

So, it just depends on kind of where you want to place that bet. And then as long as you place that bet and know that, then you can kind of monitor how things are evolving. Is margin increasing? Uh, and is that customer concentration uh declining to where they're broadening out and then of course it would help if the entire artificial intelligence boom kind of keeps going, we expand that plateau. That's pretty critical for uh Bloom Energy and sort of a bottom line on it.

for a bottom line takeaway on Bloom, the big play here is can they get more customers and can they grow fast their margins faster? That's the real play on Bloom. My take uh is that you really want to see expansion not only to customers but margins both happening.

What that's probably going to rely on is not just an expansion of what artificial intelligence is used for, whether it's in healthcare, robotics, you know, space, you know, whatever, AGI, which, you know, I don't believe in AGI, but whatever. Um, what we really want to see is an expansion of that boom, kind of like what we talked about in that memory cycle where you can expand out that data center plateau before you kind of get that eventual decline. Ideally, you get some more scurves of AI data center growth and you really get fuel cells becoming sort of a core product for not just Oracle uh that they purchase but also other data centers.

Uh, quick, uh, followup. I want to do a quick followup on the, uh, uh, Bloom Energy thing just to give a little bit of a of a bottom line on this.

So, we got that. And then I want to follow up and just remind uh or put like a bottom line because I feel like I didn't like have a really good bottom line on on Bloom. So, for a bottom line takeaway on Bloom, the big play here is can they get more customers and can they grow fast their margins faster? That's the real play on Bloom. My take uh is that you really want to see expansion not only to customers but margins both happening.

Bloom Energy Nancy Pelosi trade already fading.