Forget the SpaceX IPO. This Stock Is a Better Bet for Long-Term Investors.

The SpaceX initial public offering is now just days away. You may be thinking about buying a stake in this well-touted stock once it begins trading, in fact, or perhaps you're even hoping to participate directly in the initial placement.

If you're a risk-tolerant long-term investor, though, there may be a better bet. Rather than jumping into a newly minted ticker that's at least as likely to be lower as it is to be higher within a few weeks, consider stepping into a position in Bloom Energy (NYSE: BE) while the stock's cooled off a bit from its red-hot rally earlier this year.

What's Bloom Energy?

Never heard of it? Don't worry if you haven't. It's not a household name. And, with a market cap of only a little over $70 billion, it's not exactly a company that the financial media prioritizes either. Buried treasure often comes in small packages, though.

Bloom Energy is helping solve the world's energy shortage by installing electricity-generating systems right where that power is used. Its equipment can be a backup or auxiliary source of power, or the primary source. And, since its equipment is highly scalable, it can be used to provide electricity for a single small building, or an entire factory, or -- yes -- an artificial intelligence data center.

The distinguishing feature of its technology, however, is how it generates this electricity onsite. Rather than a massive (and expensive) natural gas turbine or a sprawling solar panel farm or a mini nuclear reactor, Bloom Energy makes and markets solid oxide fuel cells, which convert a gas into electricity using an electrochemical process catalyzed by the materials within the cell itself -- solid ceramic electrolytes, to be specific. It's efficient and incredibly clean. The only byproduct is CO2, which can be readily captured and used for other industrial purposes.

Image source: Getty Images.

Some investors may recognize that this idea is already being commercialized by names like Ballard Power Systems, FuelCell Energy, and Plug Power, with mixed (at best) fiscal success. For instance, Plug Power -- arguably best known for hydrogen-fuel-cell-powered forklifts -- remains unprofitable despite being in business for nearly three decades. Indeed, its losses are widening specifically because it's spending heavily to capitalize on the onsite power generation opportunity that's exploded in just the past few years.

Bloom is relatively unique within the fuel cell business, though, in that it's now consistently -- and increasingly -- profitable for all the right reasons.

Incredibly flexible technology makes all the difference

At the risk of wading too deep into the scientific details, Bloom is different than most of the other fuel cell companies it's often compared to for one simple reason. That's its proprietary solid oxide found within its fuel cells, which can use natural gas, biogas, or hydrogen to generate electricity. Although natural gas is the most commonly used fuel source for its equipment simply because it's abundant and readily available, its customers like the option of being able to switch fuels in the future as costs, logistics, or emissions rules change.

And Bloom Energy's recent results speak volumes about this demand. Last quarter's top line soared 130% year over year to $751 million, accelerating last year's revenue growth of 37%. Moreover, operating income of $72 million for the three months ending in March reversed a year-earlier quarterly loss of nearly $24 million, underscoring -- and widening -- last year's move out of the red and into the black.

The company says more of the same is in the cards, too, offering guidance for sales growth on the order of 80% this year, leading to full-year per-share profits of somewhere between $1.85 and $2.25. And analysts agree, expecting Bloom to report revenue growth of more than 80% in 2026 with more than another 70% likely for next year, pushing per-share profits up from last year's $0.76 to $2.13 this year, en route to a consensus of $4.35 per share in 2027.

This is still just the beginning, though. Now that the technology is proven and the need is tremendous (yes, largely thanks to AI data centers), Precedence Research believes the global fuel cell market is poised to grow at an average annual pace of 25% through 2035.

Maximizing gains starts with minimizing (and just understanding) risk

But at roughly 60 times next year's expected earnings, isn't the stock just too expensive? There's no denying you'd be paying a premium price to own this ticker right now. It's also already very near analysts' consensus price target of $270.51; there doesn't appear to be a great deal of immediate upside left to tap into.

Just remember the company's growth pace and the fact that you're looking for a long-term growth holding rather than a quick-hit trade. Bloom Energy's stock can -- and likely will -- grow into its valuation without needing to suffer a massive price correction (or several price corrections) in the meantime.

In this vein, if you're still considering the SpaceX IPO instead of something more proven and established like Bloom Energy, consider this: Analysts with Morningstar argue that SpaceX is only worth about half of the $1.75 trillion valuation implied by its IPO price. Even if Morningstar's pessimism is overstated, the fact that it's willing to voice such an unpopular stance that many euphoric investors simply don't want to hear should at least give you pause.

That, and the fact that most of the market's biggest (and well-hyped) IPOs of late made their way into the red shortly after their public offerings -- once the hype fades. The odds of this one being any different seem pretty low.

James Brumley has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bloom Energy. The Motley Fool has a disclosure policy.