Bloom Energy-Zacks Industry Outlook Constellation, Expand, Bloom and Opal Fuels

Core Viewpoint - The rapid electrification of transportation is expected to drive significant growth in the U.S. electric vehicle market, benefiting alternative energy stocks, despite challenges such as rising wind turbine costs and strained U.S.-China relations [1][2]. Industry Overview - The Zacks Alternative Energy industry is divided into two main groups: one focuses on the generation and distribution of alternative energy, while the other is involved in the development and installation of renewable projects [3]. - The industry includes companies providing fuel cell energy solutions, which have gained traction as affordable clean energy options. Global spending on clean energy reached a record $2.08 trillion in 2024, with similar investments anticipated in the coming years [4]. Growth Trends - Wind energy is a key growth catalyst, with land-based wind being the most abundant clean power technology in the U.S. as of 2024, boasting 154.6 gigawatts installed [5]. - The U.S. Energy Information Administration (EIA) projects a 4.5% year-over-year increase in wind generation for 2025, with an expected addition of 7.7 gigawatts of capacity [6]. - The electric vehicle (EV) market is experiencing a boom, with 408,688 EVs registered in Q3 2024, an 8% increase year-over-year. The U.S. EV market is projected to grow at a CAGR of 10.5% from 2025 to 2029 [7][8]. Challenges - Rising costs of renewable installations, particularly due to increased steel prices for wind turbine blades, pose significant challenges for clean energy installers [9]. - The average price of key minerals used in the wind industry has risen by 93% from January 2020 to March 2023, leading to a nearly 50% increase in the levelized cost of electricity for U.S. offshore wind projects since 2021 [10]. - Strained U.S.-China relations could impact the green energy supply chain, as China accounts for up to 90% of refining capacity for rare earth elements essential for green energy products [11]. Market Performance - The Alternative Energy Industry has outperformed both its sector and the S&P 500 over the past year, with a collective stock surge of 47.4% compared to a 1.8% decline in the Oils-Energy sector and a 14.3% gain in the S&P 500 [14]. - The industry is currently trading at a trailing 12-month EV/EBITDA ratio of 4.18, significantly lower than the S&P 500's 17.07 and the sector's 16.25 [15]. Company Highlights - **OPAL Fuels**: Announced five new fuel station services agreements, with a projected 24.3% increase in 2025 sales and a 97.9% improvement in earnings per share [16][17]. - **Expand Energy Corp.**: Reported a 2.7% year-over-year revenue increase to$ 2 billion in Q4 2024, with a projected 183.8% increase in 2025 sales [18][19]. - Bloom Energy: Achieved a 60.4% year-over-year revenue increase to $572.4 million in Q4 2024, with a long-term earnings growth rate of 40.8% [20][21]. - **Constellation Energy**: Reported a 38.1% year-over-year increase in adjusted EPS to$ 8.67, with a long-term earnings growth rate of 12.5% [22].