The large increase in the number of orders placed with each one of the fuel cell businesses analyzed in this and following articles promises a very bright future for the industry. Prototypes give way to mass production. The recent stabilization of the oil price is an effective mental tool. The road to profitability is there. The shares have potential – but not everyone has realized it yet!
High hopes for Beacon Falls project
The first-quarter figures of the 2016 fiscal year (as of 01/31/2016) were disappointing, considering the USD 12.5 million net loss attributable to common shareholders (after a USD 4.9 million loss during the same period last year). However, the share price seemed to suffer only a small temporary setback in the wake of its steep increase to USD 7.00 – and compared to the previous hike by USD 5.00 – before continuing its rapid rise. More than USD 400 million in orders have already been placed with the company, and if the large-scale Beacon Falls project can be realized (1st quarter of 2016), it won’t be hard to do the math and forecast another USD 500 million in orders, which would give the stock an additional boost.
Decision in first quarter of 2016
The company’s financial position is just as strong: In addition to cash reserves of over USD 80 million, Californian FuelCell Energy has another USD 70 million available as facilities for project funding. The stock market is counting on the promising outlook of this front runner in clean energy that uses fuel cells and waste heat to create efficiencies above 90% (power and heat). If the bid on this huge project is successful, Beacon Falls should be the reason for significantly higher stock quotes. Before the reverse split (1 for 12), the stock was quoted at above USD 10.00 per share – a fitting goal for the next round of share price jumps. Analysts from well-known investment banking firms have already set the target price to more than USD 20.
Investors must understand that buying and selling shares is done at their own risk. Consider spreading the risk as a sensible precaution. The fuel cell companies mentioned in this article are small and mid-cap ones, i.e., they do not represent stakes in big companies and the volatility is significantly higher. This article is not to be taken as a recommendation of what shares to buy or sell – it comes without any explicit or implicit guarantee or warranty. All information is based on publicly available sources and the assessments put forth in this article represent exclusively the author’s own opinion. This article focuses on mid-term and long-term perspectives and not short-term profit. The author may own shares in any of the companies mentioned in this article.
Author: Sven Jösting