What to Look for in FuelCell Earnings

FuelCell Energy Inc. (NASDAQ: FCEL) is scheduled to release its fiscal second-quarter financial results after the markets close on Wednesday. Thomson Reuters has consensus estimates calling for a net loss of $0.40 per share on $35.02 million in revenue. In the same period of last year, the company posted a net loss of $0.48 per share and revenue of $28.60 million.

Shares of this company skyrocketed early in May following an announcement that the fuel cell maker will work with Exxon on a new method to capture carbon dioxide emissions at power generation plants. FuelCell Energy received a $2.5 million grant from the U.S. Department of Energy in 2014 for development of the technology, and it struck a deal with Cenovus Energy in 2015 to complete preliminary front-end engineering and design for siting a fuel cell system to capture carbon dioxide from power plant flue gas.

The technology uses fuel cells to capture carbon dioxide emissions from power plant exhaust and replaces air that is normally used in combination with natural gas to generate power with carbon dioxide. As the fuel cell generates power, the carbon dioxide is concentrated allowing it to be more easily and cheaply captured and stored from the fuel cell’s exhaust.

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Prior to the release of the earnings report a few analysts weighed in on FuelCell:

• Roth Capital reiterated a Buy rating with a $12 price target.
• FBR reiterated a Buy rating.
• Craig Hallum initiated coverage with a Buy rating with a $13 price target.

So far in 2016, FuelCell has outperformed the market, with the stock up over 70%. However, over the past 52 weeks the stock is down 40%.

Shares of FuelCell were trading down about 3.5% at $8.31 on Tuesday, with a consensus analyst price target of $13.60 and a 52-week trading range of $4.51 to $14.04.

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