Fermi (FRMI) Stock Plunges 25% as IPO Lock-Up Ends and Challenges Mount

Key Takeaways

• Shares of FRMI plummeted 25% following the conclusion of its IPO lock-up period, unleashing approximately 32.5 million shares into the market
• The company’s first quarterly earnings report was released today, creating additional market uncertainty
• A major $150 million anchor tenant departure and active fraud litigation continue to weigh on investor sentiment
• The stock is hovering near its 52-week bottom of $5.93, representing an 81% decline from year-ago levels
• Wall Street targets range from $20 to $35, though InvestingPro data suggests current valuation concerns

Fermi Inc. (FRMI) experienced a brutal trading session Monday. The real estate investment trust’s shares plummeted 25% as selling pressure intensified following the end of its IPO lock-up restriction. Approximately 32.5 million previously restricted shares flooded the market, creating immediate downward momentum.

Fermi Inc. Common Stock, FRMI

The sell-off coincided with another significant milestone. Today marked Fermi’s debut quarterly earnings announcement — the company’s first financial disclosure covering operations from its January 10, 2025 inception through the end of December 2025. Management hosted a conference call at 8:00 a.m. Central (9:00 a.m. Eastern) to discuss the results with stakeholders.

The earnings data was published as a shareholder communication via an 8-K filing with the Securities and Exchange Commission.

Compounding the lock-up pressure, Fermi faces several operational and legal challenges. The company recently lost a significant anchor tenant representing $150 million in value — a substantial setback for an emerging REIT. Additionally, ongoing securities fraud litigation continues casting a shadow over the organization.

Since the beginning of the year, FRMI has declined approximately 23%. Over the trailing twelve months, losses have reached 81%, with shares now trading just above the 52-week floor of $5.93.

Despite the dramatic selloff, Wall Street research teams maintain bullish outlooks. Analyst price objectives span $20 to $35 — representing substantial upside from current trading levels. However, InvestingPro’s analysis, which encompasses over 1,400 U.S. equities, suggests valuation concerns persist even at these compressed prices.

Macro headwinds are amplifying company-specific challenges. Market observers note that climbing Treasury yields are creating sector-wide pressure on real estate and utility stocks, adding another layer of difficulty for Fermi’s recovery efforts.

Project Matador: Strategic Development Continues

While near-term performance remains challenged, Fermi’s long-range infrastructure development progresses. The organization recently obtained a $165 million senior secured term loan from CSG Investments, a Beal Bank USA affiliate. These proceeds will finance six Siemens Energy SGT-800-57 gas turbines — each rated at 57MW — scheduled for delivery in 2028.

Fermi’s Project Matador achieved a milestone with approval of its initial 6GW clean air permit from the Texas Commission on Environmental Quality. The company intends to submit applications for an additional 5GW permit, potentially bringing total authorized capacity to approximately 17GW.

Regarding nuclear development, Fermi is collaborating with Hyundai Engineering & Construction on Front-End Engineering Design for four AP1000 nuclear units at the Project Matador site.

Street Views

Citizens analyst Greg Miller maintained his Market Outperform recommendation, highlighting Fermi’s data center expansion and capital investment strategy at Project Matador. Evercore ISI analyst Nicholas Amicucci characterized the environmental permit approval as a constructive development for the project timeline.

FRMI maintains dual listings on both the Nasdaq and London Stock Exchange under identical ticker symbols.

The stock’s 52-week minimum sits at $5.93. As of publication time, shares were changing hands at $6.18.

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