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Why Bloom Energy Stock Dropped 5% Today

By Rich Smith – Oct 2, 2020 at 11:27AM

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Someone just put a big chunk of the stock on the market.

What happened

Shares of fuel cell stock Bloom Energy (BE 0.62%) dropped nearly 8% in early trading today. The shares remained down about 5.2% as of 10:35 a.m. EDT.

So what just reported a big block trade in Bloom Energy. Last night it was revealed that someone is selling 9.2 million shares, asking for anywhere between $16.20 and $16.50 a share. With Bloom shares closing the day at about $17 Thursday, that price range was already disconcerting, and it got more so when the final price was announced this morning: $16.20, the bottom of the range.

Glowing red stock chart arrow trending down

Image source: Getty Images.

Now what

The block trade in question is sizable: about 6.9% of all Bloom Energy shares now outstanding, according to data from S&P Global Market Intelligence. And the ultimate price received for these shares, $16.20, is a big decline from Thursday's close, indicating that there wasn't a huge appetite among buyers for so many shares at any higher prices.

On the other hand, with so many shares becoming available at such a low price, it's not at all surprising that no one was interested in buying other Bloom shares for more than $17. And with the share price having already recovered, it looks like the wave of selling has passed.

Absent any more substantive news, if you liked Bloom stock yesterday, I see no compelling reason to sell it today.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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