Should You Buy Fermi Inc (FRMI) Today? Analysis, Price Targets, and 2026 Outlook.
Conclusion
Hold
Latest Price
9.700
1 Day change
-2.61%
52 Week Range
36.990
Analysis Updated At
2026/01/28
FRMI is not a good buy right now for a beginner long-term investor who is impatient about entry timing. Despite a constructive short-term technical setup and bullish analyst initiations, the current dominant drivers are event-risk and business-execution uncertainty (multiple class-action headlines, alleged IPO misstatements, and questions around tenant/funding progress) on top of a business that is still pre-revenue with large losses. The risk/reward is not favorable for an immediate long-term entry at this moment.
Technical Analysis
Price closed at 9.88 (+3.86%) after a strong session, with a small post-market dip (-0.80%). Momentum is improving: MACD histogram is positive (0.322) and expanding, suggesting bullish acceleration. RSI(6) ~59.6 is neutral-to-slightly-bullish (not overbought). Moving averages are converging, consistent with a transition phase rather than a mature uptrend. Key levels: Pivot 9.565 is the near-term line to hold; resistance sits at R1 10.237 then R2 10.653. A fast push into 10.24–10.65 is possible, but the stock is still vulnerable to sharp reversals on headlines. Pattern-based forecast provided is slightly negative near-term (higher odds of small declines over the next day/week).
Options Data
Bullish
Open Interest Put-Call Ratio
Bearish
Option Volume Put-Call Ratio
Options are sending mixed signals. Open Interest P/C at 0.69 suggests positioning leans bullish longer-dated/structural. However, the Put/Call Volume ratio at 3.42 signals heavy put demand intraday (more defensive/negative short-term sentiment). Volume is extremely elevated vs the 30-day average (~183%), consistent with headline-driven trading. Implied vol (30D ~132%) is very high in absolute terms, but IV percentile/rank (~3) indicates IV is low relative to its own recent history—often seen after volatility has already been realized and may be pricing less incremental fear than before.
Technical Summary
Sell
6
Buy
5
Positive Catalysts
1) Potential tenant agreement progress: management reportedly remains in negotiations and believes it can reach a deal (or sign another customer from the pipeline). 2) Analyst support: Texas Capital initiated with Buy and $23 PT; Stifel maintained Buy and highlighted progress on lease conditions and customer pipeline. 3) Upcoming earnings event (QDEC 2025) on 2026-02-09 pre-market could clarify runway, funding status, and commercialization timeline.
Neutral/Negative Catalysts
1) Legal overhang: multiple class action lawsuit headlines (Jan 27–28) alleging misleading IPO statements related to tenant demand and funding risks—this can pressure the stock and increase headline volatility. 2) Funding uncertainty: news mentions termination of a key funding agreement (as described by law-firm investigation headlines), which is material for a capital-intensive buildout story. 3) Execution risk: tenant negotiations have been delayed; timeline pull-ins (bringing 2027 clients into 2026) increase operational complexity. 4) High-volatility profile: extremely high historical volatility and headline-driven options flow raise the probability of sharp, sudden drawdowns.
Financial Performance
Latest provided quarter: 2025/Q3. The company is effectively pre-revenue (Revenue: 0) and loss-making (Net Income: -346,812,000; EPS: -0.74), with gross margin also at 0. This indicates the investment case hinges on future project execution, tenant signings, and financing rather than proven operating growth trends in current financial statements.
Growth
Profitability
Efficiency
Analyst Ratings and Price Target Trends
Recent trend is positive on ratings/targets: Texas Capital initiated coverage (2026-01-20) with a Buy and $23 price target, framing FRMI as levered to AI infrastructure constraints and valuing the stock as pricing only ~10% of projected power capacity. Stifel reiterated Buy (2025-12-12) but noted near-term friction: negotiations with the first key tenant were delayed after attempted LOI term changes, though Stifel believes the LOI remains active and the Texas Tech lease conditions are satisfied.
Wall Street pros: large upside if tenant contracts and financing lock in; perceived strategic positioning for AI data center/power bottlenecks. Cons: near-term commercialization uncertainty, funding/contract timing risk, and now a meaningful legal overhang that can cap multiples and keep the stock volatile.
Wall Street analysts forecast FRMI stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for FRMI is 30.25 USD with a low forecast of 20 USD and a high forecast of 37 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
8 Analyst Rating
Wall Street analysts forecast FRMI stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for FRMI is 30.25 USD with a low forecast of 20 USD and a high forecast of 37 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
8 Buy
0 Hold
0 Sell
Strong Buy
Current: 9.960
Low
20
Averages
30.25
High
37
Current: 9.960
Low
20
Averages
30.25
High
37
Texas Capital
NULL -> Buy
initiated
$23
AI Analysis
2026-01-20
Reason
Texas Capital
Price Target
$23
AI Analysis
2026-01-20
initiated
NULL -> Buy
Reason
Texas Capital initiated coverage of Fermi with a Buy rating and $23 price target. Fermi is currently developing the world's largest hybrid energy and data center development campus, notes the analyst, who sees the company being "uniquely positioned to capitalize" on the primary constraint facing hyperscalers as they build out to support their AI compute needs, namely bypassing long interconnection queues and achieving reliability. The stock is pricing approximately 10% of the company's projected power capacity at its current valuation, offering "material potential upside to what appears to be a low-risk play on AI infrastructure," the analyst added.
Stifel
Stephen Gengaro
Buy
maintain
2025-12-12
Reason
Stifel
Stephen Gengaro
Price Target
2025-12-12
maintain
Buy
Reason
Stifel analyst Stephen Gengaro notes that in conversation with Fermi management, the company indicated that it is still in negotiations with its first key tenant. The tenant attempted to change the terms of the LOI at the last minute, and Fermi opted to call their bluff. This has delayed an agreement, but management is back in talks with the initial potential client and appears confident it will reach a deal with this client or potentially another customer from their pipeline, Stifel adds. The company noted it is now working to get its potential 2027 clients online in 2026. The LOI for the first tenant is still active, and the firm believes the company has satisfied conditions for its lease from Texas Tech University, and that lease is not at risk of being canceled. Stifel has a Buy rating on Fermi.
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