Stock Market Today, Oct. 23: Bloom Energy Falls on Cash Flow Concerns Despite Record Q3 Revenue

Bloom Energy (NYSE:BE), a solid-oxide fuel cell systems provider, closed at $193.30, down 11.24%. Investors are locking in profits as the company reports negative operating cash flow and faces heavier expansion spending after an earnings beat-and-raise.
Trading volume reached 34.7 million shares, coming in about 117% above its three-month average of 15.9 million shares. Bloom Energy IPO'd in 2018 and has grown 672% since going public.

How the markets moved today

The S&P 500 (SNPINDEX:^GSPC) closed at 7,623, down 0.53%, while the Nasdaq Composite (NASDAQINDEX:^IXIC) closed at 25,955, down 0.21%. Among stationary fuel cells and distributed onsite power systems for commercial and data center customers, Plug Power closed unchanged at $1.38, and FuelCell Energy closed at $11.11, down 4.06%.

What this means for investors

Bloom Energy's solid-oxide fuel cell systems are an ideal solution for data center power needs. That helps explain why revenue soared 138% year over year in the third quarter. Investors were anticipating the growth, though, and some investors have decided to cash out after shares have soared more than 122% this year, even considering today's drop.

Bloom again raised its full-year revenue guidance, but investors focused on cash generation and capital spending needs. Demand is strong, and Bloom is growing production capacity.

The company reported negative free cash flow of $181 million for the quarter, spooking some investors into selling shares. The stock is now 44% off its recent high, giving investors a more reasonable valuation for those who believe the data center build-out has a long way to go.

Howard Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bloom Energy. The Motley Fool has a disclosure policy.