UBS Downgrades Fermi (FRMI) to Neutral

UBS analyst John Hodulik downgraded Fermi (NASDAQ: FRMI) from Buy to Neutral with a price target of $6.00 (from $8.00).

The analyst comments: “We are downgrading shares of FRMI to Neutral as we await greater clarity around the C suite transition and extension of milestones under the land lease with the Texas Tech University System (TTUS). Fermi announced a series of leadership transitions in recent weeks including the departures of the CEO and CFO. Based on our interpretation of Board commentary, the departures appear driven by the lack of a tenant lease signed to date and the Board's outlook under the status quo. The company has made early progress in its transition to Fermi 2.0 with last week's announcement of Rob Mason II as interim CFO and engaged an executive search firm for a new CEO - likely a ~3 month process based on company commentary. Net, demand for AI infrastructure continues to reach new highs and we believe eventual execution of a tenant lease would re-rate the stock (UBS upside share price of $17) but recent developments point to a lengthened timeline for revenue commencement as engagement with potential tenants and partners is reset.”

For an analyst ratings summary and ratings history on Fermi click here. For more ratings news on Fermi click here.

Shares of Fermi closed at $5.07 yesterday.

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