FuelCell Energy (NASDAQ:FCEL) Shares Gap Up - Still a Buy?

Key Points

• FuelCell Energy shares jumped at the open, but the move comes amid a volatile backdrop and recent profit-taking after a strong multi-month rally.
• The biggest near-term drag is an upsized common stock offering that grew from $200 million to $225 million, raising dilution concerns for investors.
• On the positive side, FuelCell announced a collaboration with Siemens to speed deployment of fuel cell distributed power systems, including potential 100+ MW projects and data center applications.

FuelCell Energy, Inc. (NASDAQ:FCEL - Get Free Report)'s share price gapped up before the market opened on Thursday . The stock had previously closed at $22.54, but opened at $24.20. FuelCell Energy shares last traded at $23.8410, with a volume of 4,812,057 shares traded.

Key Stories Impacting FuelCell Energy

Here are the key news stories impacting FuelCell Energy this week:

• Positive Sentiment: FuelCell Energy also announced a collaboration with Siemens to accelerate deployment of fuel cell-based distributed power systems, including work on 100+ MW commercial projects and potential data center applications, which could improve long-term growth prospects. Siemens and FuelCell Energy Collaborate to Explore Scalable Fuel Cell Power Solutions
• Neutral Sentiment: A recent insider sale by EVP Shankar Achanta was disclosed, but the transaction was relatively small and looks more like a routine filing than a major fundamental change. FuelCell Energy insider trade disclosure
• Negative Sentiment: The biggest overhang is the upsized public offering of common stock, which increased from $200 million to $225 million and is weighing on FCEL because investors typically dislike dilution, especially after a sharp recent run-up. FuelCell Energy Announces Upsize and Pricing of Offering of Common Stock
• Negative Sentiment: Analysts and commentators also noted profit-taking after FCEL’s powerful multi-month rally, amplifying the selloff alongside the stock sale news. Why FuelCell Energy Stock Is Tumbling on Wednesday

Analyst Upgrades and Downgrades

Several equities analysts have commented on FCEL shares. UBS Group lifted their target price on shares of FuelCell Energy from $7.25 to $22.00 and gave the stock a "neutral" rating in a research report on Friday, June 26th. Wells Fargo & Company lifted their price target on FuelCell Energy from $6.00 to $8.00 and gave the stock an "underweight" rating in a report on Tuesday, June 16th. Wall Street Zen downgraded FuelCell Energy from a "hold" rating to a "sell" rating in a research note on Saturday, June 13th. Canaccord Genuity Group raised their target price on FuelCell Energy from $12.00 to $30.00 and gave the company a "buy" rating in a research report on Tuesday, June 9th. Finally, B. Riley Financial raised shares of FuelCell Energy from a "neutral" rating to a "buy" rating and boosted their price target for the stock from $13.00 to $32.00 in a report on Monday, June 29th. Three analysts have rated the stock with a Buy rating, four have issued a Hold rating and two have issued a Sell rating to the company's stock. Based on data from MarketBeat, the company presently has a consensus rating of "Hold" and an average price target of $22.00.

FuelCell Energy Price Performance

The company has a current ratio of 8.59, a quick ratio of 7.20 and a debt-to-equity ratio of 0.18. The stock has a market cap of $1.59 billion, a PE ratio of -3.55 and a beta of 2.31. The business has a 50-day moving average price of $21.00 and a 200 day moving average price of $12.47.

FuelCell Energy (NASDAQ:FCEL - Get Free Report) last announced its quarterly earnings data on Monday, June 8th. The energy company reported ($0.53) earnings per share (EPS) for the quarter, missing analysts' consensus estimates of $0.52 by ($1.05). The firm had revenue of $35.59 million during the quarter, compared to the consensus estimate of $40.47 million. FuelCell Energy had a negative net margin of 132.41% and a negative return on equity of 15.90%. During the same quarter in the prior year, the firm posted ($1.79) earnings per share. As a group, research analysts forecast that FuelCell Energy, Inc. will post -1.84 earnings per share for the current fiscal year.

Insider Transactions at FuelCell Energy

In other FuelCell Energy news, EVP Shankar Achanta sold 2,500 shares of the stock in a transaction on Monday, July 6th. The stock was sold at an average price of $28.71, for a total transaction of $71,775.00. Following the sale, the executive vice president owned 2,618 shares in the company, valued at $75,162.78. This represents a 48.85% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available at this link. 5.46% of the stock is owned by insiders.

Hedge Funds Weigh In On FuelCell Energy

A number of large investors have recently modified their holdings of the company. Kestra Advisory Services LLC bought a new position in shares of FuelCell Energy in the fourth quarter worth $29,000. Bank of America Corp DE boosted its position in shares of FuelCell Energy by 31.9% during the 2nd quarter. Bank of America Corp DE now owns 18,351 shares of the energy company's stock valued at $103,000 after acquiring an additional 4,435 shares during the last quarter. Rhumbline Advisers raised its stake in FuelCell Energy by 21.1% in the first quarter. Rhumbline Advisers now owns 32,012 shares of the energy company's stock valued at $147,000 after purchasing an additional 5,585 shares in the last quarter. Caitong International Asset Management Co. Ltd raised its stake in FuelCell Energy by 1,316.0% in the third quarter. Caitong International Asset Management Co. Ltd now owns 7,618 shares of the energy company's stock valued at $59,000 after purchasing an additional 7,080 shares in the last quarter. Finally, Entropy Technologies LP lifted its position in FuelCell Energy by 28.6% during the first quarter. Entropy Technologies LP now owns 37,519 shares of the energy company's stock valued at $245,000 after purchasing an additional 8,336 shares during the last quarter. 42.78% of the stock is currently owned by institutional investors.

FuelCell Energy Company Profile

FuelCell Energy, Inc NASDAQ: FCEL is a publicly traded company that designs, manufactures and operates turnkey molten carbonate fuel cell power plants. These stationary, on-site energy solutions generate electricity and heat through an electrochemical process that combines natural gas or biogas with oxygen, producing power with lower greenhouse gas emissions than traditional fossil fuel-based generation. The company’s fuel cell technology is engineered for continuous, baseload operation and can be integrated into microgrid architectures and industrial power systems to provide reliable, around-the-clock energy.

The company’s core product suite, marketed under the SureSource brand, encompasses both power generation and integrated carbon capture or hydrogen production capabilities.

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