Fervo Energy's Long-Term Opportunity Intact Despite Short-Seller Report, RBC Says

MT Newswires Live10-09

Fervo Energy's (FRVO) long-term opportunity remains intact despite a recent short-seller report questioning the viability of its enhanced geothermal systems developments, RBC Capital Markets said in a Friday note.

The short-seller report extrapolated performance results from the Project Red pilot and interviews with former employees to draw conclusions on Fervo's Cape Station project, the note said, adding that the company had already addressed many of these claims in an April blog post.

While noting that longer-dated data from Cape Station is needed to validate long-term recovery assumptions, RBC said Fervo's drilling speeds continue to improve.

RBC Capital Markets maintained its outperform rating on Fervo Energy and lowered its price target to $36 from $46.

The firm said its price target reduction was part of a coverage-wide adjustment to reflect changes in the macroeconomic backdrop, rather than a change in Fervo's underlying financial assumptions.

Price: 13.57, Change: -0.24, Percent Change: -1.70

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