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The shares of Bloom Energy Corp. hit a record low on Tuesday after a short seller uncovered billions of debts and called the company clean energy of "obvious candidate for bankruptcy".
Bloom Energy
TO BE, -22.91%
the stock fell more than 20% to a historic all-time low of $ 3.15. It was down 90% from a high of $ 35.80 on September 26, 2018 and 80% lower than the price of its July 2018 initial public offering of $ 15.
Short seller Hindenburg Research said it discovered an undisclosed service liability estimated at $ 2.2 billion.
"Bloom's delicate accounting allows him to hide maintenance costs and defer write-downs over other periods, thus avoiding accounting for the additional major losses that have recently occurred," Hindenburg said in a research note. "We believe that the significant debt maturities in 2020 and 2021, which amount to nearly $ 520 million, make Bloom Energy a clear candidate for bankruptcy."
The company "will become another tombstone in the cemetery of the dead unicorns of Silicon Valley," Hindenburg said.
"We totally disagree with the conclusions drawn," Bloom said in a statement on Tuesday. "In particular, the service replacement responsibility mentioned in the report is extremely misleading. Bloom Energy will make another statement on this topic in due course. "
Hindenburg's analysts did not get involved with the company, added Bloom.
Bloom manufactures solid oxide fuel cells that are used in fixed and on-site power generation servers. Servers convert natural gas or biogas into electricity through an electrochemical reaction, resulting in reduced emissions, the company says.
Bloom Energy shares fell 43% on Aug. 13, fearing that clean energy initiatives in key states, such as bans or shutdowns in new natural gas connections, will end up hurting society.
Hindenburg claimed that Bloom's technology was "not sustainable, clean, green or profitable remotely".
Bloom placed its initial public offering at the top of the range last year. It slipped under the IPO price at the end of 2018. It closed above the IPO price only four times this year, the last time on May 3rd. It has been traded at a single figure since the beginning of August.
Shares are down more than 67% this year, contrasting with gains of 20% for the S & P 500 Index
SPX, + 0.11%
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