FuelCell Energy (FCEL, US-$ 1,20) has reported a wide range of orders and technological breakthroughs. At the 2015 Hanover trade show, the biggest fuel cell in the world was presented (4.5 m. long), with an output of 400 kW. The company sees itself to be well on the way to be able to construct innovative, high performance complete FC systems for large scale use (universities, industry, hospitals, and much more) in order to be able to produce clean electricity very efficiently and to put the waste heat to use as well. With the partners O & G Industries and CT Energy + Technologies, an order was gained from the US city/municipal authority Beacon Falls in Connecticut for a 63-MW-FC power plant, which according to the company will be the biggest of its kind in the world when it is complete. It proved possible to win a 1.4 MW project in Riverside/California. At the same time, FuelCell Energy is working on differing major projects all over the world, among others together with the South Korean firm Posco.
Assessment: the company is perfectly positioned (over US$150m. in liquid assets, including a 40m. credit line from the shareholder NRG Energy) and should therefore be in the position of being able to gain major projects; it is also well positioned worldwide. Those who are able to wait should not allow themselves to be deceived by the low share price, as the company has know-how which is in demand all of the world, and it is therefore highly likely to be awarded the contract for many of the projects which are currently in the pipeline (= investors’ imagination). In addition to this, FuelCell Energy is also focusing on the continuous improvement of its technological expertise with the latest, more efficient and lower cost processes for the use of energy with FC.
Note on risk
Every investor should be aware of their own risk assessment when investing in shares and pay due consideration to an appropriate spreading of risk. This report does not constitute purchasing recommendations – without guarantee. All of the data revolves around publicly accessible sources and in terms of the assessment only represent the personal opinion of the author.
This analysis was written June 1st 2015.
Author: Sven Joesting