{
  "@context": "https://frontierpicks.com/schemas/dossier.v1.json",
  "ticker": "FRVO",
  "name": "Fervo Energy Company",
  "url": "https://frontierpicks.com/dossiers/FRVO/",
  "json_url": "https://frontierpicks.com/dossiers/FRVO.json",
  "status": "WATCHLIST",
  "current_conviction": "LOW",
  "archetype": {
    "code": "a5",
    "n": 5
  },
  "current_thesis": "Fervo Energy shares look more likely to lag the S&P 500 over three months: IPO lock-up supply and broker target cuts outweigh an $11.9 billion backlog. Cape Station's GeoBlocks 2 and 3 reaching commercial operation by 1 January 2027 decide whether execution changes that.",
  "invalidation_trigger": "A daily close above $16, well clear of the 50-day moving average, which would show buyers absorbing the shares unlocked on 2026-11-09 and the shares leading; or Google exercising its option for about 600 MW more at Cape Station.",
  "catalyst_date": null,
  "portfolio": null,
  "pick": null,
  "themes": [
    "ai-datacenter-infrastructure",
    "solar-clean-energy"
  ],
  "tags": [],
  "sources": [],
  "notes": [
    "Fervo Energy listed on Nasdaq on 2026-05-13 after pricing its IPO at $27 per Class A share on 2026-05-12.",
    "The IPO lock-up on about 200 million Class A shares expired on 2026-11-09, per a TIKR analysis.",
    "Consolidated net income differs from the result attributable to common stockholders: in Q3 2026, $11.7 million versus a $20.8 million loss."
  ],
  "source_links": [
    {
      "title": "Fervo Energy Reports Third Quarter 2026 Results",
      "url": "https://greenstocknews.com/news/nasdaq/frvo/fervo-energy-reports-third-quarter-2026-results",
      "date": "2026-11-09"
    },
    {
      "title": "Fervo Energy Just Dropped 35% in a Month. Is It Time to Sell, or Load Up?",
      "url": "https://www.tikr.com/blog/fervo-energy-just-dropped-35-in-a-month-is-it-time-to-sell-or-load-up",
      "date": "2026-11-08"
    },
    {
      "title": "Fervo prices above range at $27, raises $1.89B",
      "url": "https://www.axios.com/pro/climate-deals/2026/05/13/fervo-prices-27-upsized",
      "date": "2026-05-13"
    },
    {
      "title": "whbl.com",
      "url": "https://whbl.com/2026/09/01/fervo-signs-396-mw-geothermal-power-supply-deal-with-google-shares-jump/",
      "date": "2026-09-01"
    },
    {
      "title": "FRVO Q3 Earnings Call Highlights Google Deal and Geothermal Expansion",
      "url": "https://zacks.com/stock/news/3027285/frvo-q3-earnings-call-highlights-google-deal-and-geothermal-expansion",
      "date": null
    }
  ],
  "evidence": [
    {
      "claim": "Contracted revenue backlog about $11.9 billion, up from about $7.2 billion; binding PPA capacity 1,054 MW, up from 658 MW",
      "source": "Fervo Q3 2026 results release, 2026-11-09",
      "as_of": "2026-11-09"
    },
    {
      "claim": "Q3 2026 revenue $116,000; operating loss $43.7 million; G&A $39.4 million versus $27.4 million in Q2",
      "source": "Fervo Q3 2026 results release and 10-Q",
      "as_of": "2026-09-30"
    },
    {
      "claim": "Unrestricted cash $1.92 billion and total debt $301.6 million at quarter end",
      "source": "Fervo Q3 2026 results release",
      "as_of": "2026-09-30"
    },
    {
      "claim": "Q4 2026 capex guided at $450-500 million; H2 2026 capex guide cut to $700-750 million from $850-900 million",
      "source": "Fervo Q3 2026 results release, 2026-11-09",
      "as_of": "2026-11-09"
    },
    {
      "claim": "33 MW GeoBlock 1 at Cape Station entered commercial operation; GeoBlocks 2 and 3 guided to commercial operation by 2027-01-01",
      "source": "Fervo Q3 2026 results release, 2026-11-09",
      "as_of": "2026-11-09"
    },
    {
      "claim": "Morpheus Research short report alleged water loss, earthquake damage and rising costs at Fervo plants; company disputed it",
      "source": "TIKR analysis citing Morpheus Research report of 2026-10-06",
      "as_of": "2026-10-06"
    },
    {
      "claim": "BofA Securities cut its price target to $25 from $30 and kept a Buy rating",
      "source": "BofA Securities note reported 2026-11-12",
      "as_of": "2026-11-12"
    },
    {
      "claim": "Baird lowered its price target to $20 and kept an Outperform rating",
      "source": "Baird note reported 2026-11-10",
      "as_of": "2026-11-10"
    }
  ],
  "view_changes": [],
  "frame": null,
  "filed_numbers": {
    "as_of": "2026-11-13",
    "sector": "Utilities",
    "financials": {
      "status": "ok",
      "reason": null,
      "close_date": "2026-11-13",
      "latest_quarter": "2026-09-30",
      "figures": {
        "revenue": {
          "status": "ok",
          "quarters": [
            {
              "end": "2026-09-30",
              "filed": "2026-11-10",
              "value_musd": 0.1,
              "yoy_pct": 110.9
            },
            {
              "end": "2026-06-30",
              "filed": "2026-08-13",
              "value_musd": 0.1,
              "yoy_pct": null
            },
            {
              "end": "2026-03-31",
              "filed": "2026-06-23",
              "value_musd": 0.1,
              "yoy_pct": null
            },
            {
              "end": "2025-09-30",
              "filed": "2026-11-10",
              "value_musd": 0.1,
              "yoy_pct": null
            },
            {
              "end": "2025-06-30",
              "filed": "2026-08-13",
              "value_musd": 0,
              "yoy_pct": null
            }
          ]
        },
        "gross_margin": {
          "status": "ok",
          "quarters": [
            {
              "end": "2026-09-30",
              "filed": "2026-11-10",
              "pct": -1181
            },
            {
              "end": "2026-06-30",
              "filed": "2026-08-13",
              "pct": -170.8
            },
            {
              "end": "2026-03-31",
              "filed": "2026-06-23",
              "pct": -690.2
            },
            {
              "end": "2025-09-30",
              "filed": "2026-11-10",
              "pct": -558.2
            }
          ]
        },
        "operating_margin": {
          "status": "ok",
          "quarters": [
            {
              "end": "2026-09-30",
              "filed": "2026-11-10",
              "pct": -37712.1
            },
            {
              "end": "2026-06-30",
              "filed": "2026-08-13",
              "pct": -25435.4
            },
            {
              "end": "2026-03-31",
              "filed": "2026-06-23",
              "pct": -32872.1
            },
            {
              "end": "2025-09-30",
              "filed": "2026-11-10",
              "pct": -24834.5
            }
          ]
        },
        "pretax_income": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-10",
          "value_musd": -18.3
        },
        "net_income": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-10",
          "value_musd": -19.5
        },
        "operating_cash_flow": {
          "status": "not available"
        },
        "capital_spending": {
          "status": "not available"
        },
        "free_cash_flow": {
          "status": "not available"
        },
        "diluted_share_change": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-10",
          "base_end": "2025-09-30",
          "pct": 3205.1
        },
        "cash": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-10",
          "value_musd": 1916.5
        },
        "debt": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-10",
          "value_musd": 301.6,
          "composition": "long-term debt"
        },
        "net_cash": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-10",
          "value_musd": 1614.9
        },
        "deferred_revenue": {
          "status": "not reported"
        },
        "backlog": {
          "status": "not reported"
        },
        "receivables": {
          "status": "not reported"
        },
        "inventory": {
          "status": "not reported"
        },
        "equity": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-10",
          "value_musd": 2790.7
        },
        "market_value": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-30",
          "basis_filed": "2026-11-10",
          "value_musd": 3392.9
        },
        "enterprise_value": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-30",
          "basis_filed": "2026-11-10",
          "value_musd": 1778.1
        },
        "ev_sales": {
          "status": "not available"
        },
        "ev_ebit": {
          "status": "not available"
        },
        "pe": {
          "status": "not available"
        },
        "pb": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-30",
          "basis_filed": "2026-11-10",
          "multiple": 1.2
        },
        "fcf_yield": {
          "status": "not available"
        }
      }
    },
    "short_interest": {
      "status": "ok",
      "settlement": "2026-10-15",
      "published": "2026-11-13",
      "short_pct_of_outstanding": 8.01,
      "days_to_cover": 2.5,
      "change_pct": -8.2
    },
    "insiders": {
      "status": "ok",
      "as_of": "2026-11-14",
      "windows": [
        {
          "days": 90,
          "status": "ok",
          "from": "2026-08-17",
          "bought_usd": 0,
          "sold_usd": 0,
          "bought_unpriced": 0,
          "sold_unpriced": 0
        },
        {
          "days": 365,
          "status": "ok",
          "from": "2025-11-15",
          "bought_usd": 0,
          "sold_usd": 0,
          "bought_unpriced": 0,
          "sold_unpriced": 0
        }
      ]
    }
  },
  "body_markdown": "## Current Thesis\nFervo Energy shares look more likely to lag the S&P 500 over the next three months. A $11.9 billion contracted backlog is set against two things: roughly 200 million Class A shares released from the IPO lock-up on 2026-11-09, and brokers that keep cutting price targets after the third-quarter report. What settles it is whether Cape Station's GeoBlocks 2 and 3 reach commercial operation by 2027-01-01, as the company guided on 2026-11-09, and whether the first full quarter of power sales shows the plant performing.\n\nThe rating is Low because the contracted business is real but the shares lack a near-term driver to outrun the index. On 2026-11-11 the shares closed at $12.94. That is below the $27 price of the 2026-05-12 initial public offering (IPO) and follows a 36.3% fall over three months. The market is now pricing execution risk and new share supply more heavily than a backlog that rose 65% in a quarter.\n\n## Bull Case\n- **Google contract lifted backlog to $11.9 billion.** The company's 2026-11-09 results release put contracted revenue at about $11.9 billion, up from about $7.2 billion. Binding power purchase agreement (PPA) capacity rose to 1,054 megawatts (MW) from 658 MW. The 396 MW Google deal announced on 2026-09-01 is a 15-year take-or-pay contract with an option for about 600 MW more.\n- **First commercial power arrived early.** The 33 MW GeoBlock 1 at Cape Station in Utah entered commercial operation on 2026-09-30, ahead of its contractual date, according to the company. GeoBlock 2 is synced to the grid and delivering test energy. GeoBlock 3 is mechanically complete.\n- **Cash covers the near-term build.** Unrestricted cash was $1.92 billion and total debt $301.6 million at 2026-09-30, per the third-quarter release. Second-half 2026 capital spending guidance fell to $700–750 million from $850–900 million. The company says construction efficiencies moved some spending later and total investment is unchanged.\n- **Cost per kilowatt is guided lower.** The company expects GeoBlocks 1–3 to cost about $7,000 per kilowatt (kW). It targets $5,500/kW for the 400 MW Cape Google expansion and $3,000/kW over the long term (2026-11-09 release).\n\n## Bear Case\n- **Lock-up release adds share supply.** The IPO lock-up on about 200 million Class A shares expired on 2026-11-09, according to a TIKR analysis updated 2026-11-08. That supply arrives while the shares are already down 36.3% over three months.\n- **Brokers cut targets after the results.** Baird lowered its target to $20 on 2026-11-10 and kept Outperform. BofA Securities cut its target to $25 from $30 on 2026-11-12 and kept Buy. Both firms cut even after a quarter that delivered the Google backlog.\n- **Revenue is still close to zero.** Third-quarter revenue was $116,000, against an analyst estimate of $165,375 reported on 2026-11-09. The operating loss was $43.7 million and general and administrative expense was $39.4 million, up from $27.4 million in the second quarter. Consolidated net income of $11.7 million depended on a $29.9 million tax benefit and an $11.8 million non-cash swap gain.\n- **A short seller challenged the plant's performance.** Morpheus Research published a report on 2026-10-06 alleging water loss, earthquake damage and rising costs at Fervo's plants. The company called the claims \"selective and outcome-driven characterizations of early-stage pilot data.\" The third-quarter release gives no well performance figures.\n- **Spending accelerates before revenue does.** The company guided fourth-quarter 2026 capital spending at $450–500 million, up from $256.7 million in the third quarter. The 400 MW Google expansion is not expected to deliver first power until mid-2028.\n\n## Setup & Price Structure\nThe shares closed at $12.94 on 2026-11-11. The 50-day moving average of adjusted closes stood at $12.83 that day, so the price sits just above it. Over three months the shares fell 36.3%.\n\nThe IPO priced at $27 on 2026-05-12. The shares have traded below that level as the Morpheus report (2026-10-06), JPMorgan's cut to $27 from $38 (2026-10-19) and the lock-up release (2026-11-09) came through. A move well clear of the 50-day average while the unlocked shares trade would show buyers absorbing the new supply. Closes below the average would point to the lock-up selling still running.\n\n## Catalyst Calendar\n\n- **~2027-01-01 (est.):** Company-guided commercial operation of Cape Station GeoBlocks 2 and 3, completing Phase I of about 100 MW. Meeting the date would test the short-seller claims against operating results. A slip would add to the execution doubts already priced in.\n- **~2027-03-10 (est.):** Q4 and full-year 2026 report, the first full quarter of Cape Station power revenue. This is the first quarter in which revenue and plant output can be checked against the company's prior expectations and the $11.9 billion backlog.\n\n## What Would Change Our Mind\n\nA daily close above $16, well clear of the 50-day moving average, which would show buyers absorbing the shares unlocked on 2026-11-09 and the shares leading; or Google exercising its option for about 600 MW more at Cape Station.\n\n## Correlation Notes\nThe shares trade mostly on company events rather than with the broad market. On 2026-09-01 they jumped intraday on the Google PPA, and on 2026-10-06 the short-seller report hit them. On 2026-11-09 company news reported the shares rising on the day of the results and the lock-up expiry, a session in which the Nasdaq 100 rose 3%. The business is tied to demand for round-the-clock power from data centres through the Google contract, so sentiment toward AI power suppliers can move the shares. The company's own results and plant milestones decide the three-month path more than the index does.",
  "first_seen": "2026-11-12",
  "last_analyzed": "2026-11-12T18:09:11+00:00",
  "last_synthesized": "2026-11-12",
  "date_modified": "2026-11-12",
  "license": "Content © FrontierPicks. Cite the canonical URL."
}