Evercore ISI sees rising tenant momentum as Fermi expands site

Evercore ISI notes that Fermi (FRMI) America’s fiscal-year 2025 shareholder letter highlights continued progress at Project Matador. While the market continues to await a firm tenant agreement, the company said its initial letter of intent remains intact and noted a significant increase in its commercial pipeline, especially following the approval of its 6GW air permit. Growing interest also led Fermi America to file for an additional 5GW of power generation with the Texas Commission on Environmental Quality on March 27. Evercore believes the intention to expand the site suggests that negotiations amongst many of the “core” tenants may be picking up in urgency and magnitude, though de-risking contract structures will take time amid uncertainty at other artificial-intelligence-campus sites. The firm reiterates and Outperform rating and $20 price target on the shares.