Mizuho on Friday lowered its price target on Fluence Energy Inc. (NASDAQ:FLNC) to $13.00 from $15.00 while retaining an Underperform rating on the battery energy storage company. The move comes as shares of FLNC have tumbled 38.4% over the past week.
The 13% cut in the price target follows disclosed cost overruns totaling $20 million across two international projects during Fluence’s first fiscal quarter. Company management has said it expects to fully recover those costs from customers and has reiterated its guidance for fiscal 2026.
Despite management’s comments, Mizuho adjusted its internal modeling. The firm moved its revenue and EBITDA assumptions toward the midpoint of the company’s guidance range after previously assuming performance nearer the upper end. Mizuho also noted that the updated guidance points to a greater concentration of revenue and profitability in the second half of the fiscal year.
Profitability remains a challenge for the global energy storage provider. Fluence reported a gross profit margin of 11.7%, a metric Mizuho highlighted in maintaining its cautious stance.
Operationally, Fluence continues to show momentum in certain commercial pipelines. Data center leads and the overall pipeline expanded, but Mizuho said it still expects order conversion to materialize in the second half of the year, consistent with the bank’s prior timeline.
The analyst firm kept its Underperform rating, pointing to several headwinds. Mizuho emphasized that growth from data center battery energy storage systems is farther out than some investors might expect. The firm also suggested that the potential upside from Fluence’s AESC line acquisition appears limited and faces increasing competitive pressure from a growing U.S. battery cell supply base.
Financial results released for the quarter offered a mixed picture. Fluence posted a loss per share of $0.34, wider than analyst expectations of a $0.21 loss per share. On the top line, the company exceeded consensus revenue estimates, reporting $475.2 million versus the $452.31 million consensus, representing a 154.4% increase from the same quarter a year earlier.
Balance-sheet metrics show the company currently carries more liquidity than debt, with a reported current ratio of 1.48. While the company’s cash position relative to debt is a stabilizing factor, the combination of cost overruns, low gross margins and a larger-than-expected quarterly loss have drawn scrutiny from analysts and investors as they reassess Fluence’s near-term financial trajectory.
These outcomes have made the recent earnings report a focal point for market participants evaluating the company’s financial health and execution risks as the business scales.