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Why Bloom Energy's Shares Jumped 22.2% Today

By Travis Hoium – Aug 18, 2020 at 4:12PM

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An insider made a big purchase of Bloom Energy stock.

What happened 

Shares of fuel cell and hydrogen company Bloom Energy (BE -0.45%) jumped as much as 22.2% in trading Tuesday after an insider bought a large amount of stock. Shares were still up 19.5% at 3:30 p.m. EDT and holding, heading into the market's close. 

So what

Jeff Immelt, former CEO of GE, was the person who bought stock recently, and it was a big purchase. He acquired 70,000 shares of stock at an average price of $14.86 per share for more than $1 million in purchases. 

Hydrogen storage tanks in front of solar and wind assets.

Image source: Getty Images.

The reason Immelt's purchase is so notable is because he is on the Board of Directors at Bloom Energy. As a board member, Immelt invariably gets inside information about the company's direction; the fact that he was bullish enough to put $1 million of his own money behind the company is seen as a good sign. 

Now what

Insider transactions can be tricky for investors to decipher because we don't know the intention of purchases or sales. Sales may occur in order to buy a home, for example, or fund a child's college with options or grants awarded by the company, while purchases often tell us more. Immelt didn't have to buy Bloom Energy stock; he did so on the open market rather than with something like options. I think that's a positive sign for this renewable energy stock and its improving long-term outlook. 

Travis Hoium owns shares of General Electric. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Stocks Mentioned

Bloom Energy Stock Quote
Bloom Energy
$20.04 (-0.45%) $0.09
General Electric Stock Quote
General Electric
$85.00 (-0.33%) $0.28

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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