Citizens has maintained a Market Outperform rating and set a $30.00 price target on Fermi Inc. (NASDAQ: FRMI) after conducting a site visit to the company’s 11GW data center development, the research firm said. At the prevailing share price of $9.52, that target equates to an upside of just over 215% and sits within a broader analyst range that runs from $20 to $37.
Behind-the-meter energy strategy
Citizens expressed confidence in Fermi’s plan to build a large-scale, behind-the-meter data center complex that would be supplied by a mix of natural gas and nuclear generation. The firm described that configuration as a credible non-grid power alternative for hyperscale customers seeking reliable, self-contained energy solutions.
The research note emphasized the particular relevance of this approach in Texas, where changes to the ERCOT power approval process have altered the operating environment for data center operators. Citizens framed the project as a response to evolving power considerations in the region.
Leasing interest and customer dynamics
Despite an earlier Letter of Intent (LOI) customer that did not convert following Fermi’s initial public offering - which raised roughly $683 million in capital - Citizens said the same party remains in late-stage negotiations for a substantial portion of the company’s anticipated capacity. The firm also cited multiple other interested customers, arguing that demand appears sufficient to fill what could become one of North America’s largest data center assets.
Project milestones and setbacks
In recent company announcements, Fermi reported the arrival of six Siemens Energy SGT-800 natural gas turbines at the Port of Houston for its Project Matador energy campus. Citizens characterized the delivery as a material step toward the first gigawatt of power planned for the site.
At the same time, Fermi disclosed that its first prospective tenant terminated a $150 million Advanced in Aid of Construction Agreement after the exclusivity period in that tenant’s LOI expired. The company noted that no funds had been drawn from the agreement prior to termination.
Broader analyst coverage
Citizens’ initiation of coverage with a Market Outperform rating and a $30.00 target is accompanied by other recent analyst actions. Texas Capital Securities began coverage with a Buy rating and a $23.00 price target, citing potential demand driven by AI computing needs. Cantor Fitzgerald reiterated an Overweight rating and set a $33.00 price target after management discussions focused on the company’s data center leasing strategy.
Taken together, these developments paint a mixed picture for investors: the underlying technical progress on energy infrastructure and apparent customer interest provide reasons for optimism, while the failure of an early LOI to convert and the termination of an aid-of-construction agreement underscore tangible near-term risks.
What this means for markets
Fermi’s trajectory intersects with several market segments, including data center real estate, energy project financing and the AI infrastructure ecosystem. The company’s progress in deploying behind-the-meter generation and the presence of multiple prospective customers inform market expectations about its leasing prospects and the potential scale of its asset base.