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- FuelCell Energy stock dropped over 7% Thursday after a lackluster fourth quarter earnings report.
- The company posted a 17% revenue increase on a full-year basis, but it still trades at 34x sales.
- JPMorgan warned the valuation of FuelCell may be overheated in a note earlier this month.
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FuelCell Energy stock dropped over 7% on Thursday after delivering a lackluster performance in the fourth quarter.
Analyst forecasts had predicted a $0.04 loss per share on revenue of $17.05 million for FuelCell. The company missed those estimates, notching an $0.08 loss per share on revenues of $17 million.
FuelCell also posted a net loss of $18.9 million in the quarter, although that is an improvement from the company’s $35.2 million net loss from the year-ago quarter.
On a full-year basis, FuelCell Energy’s revenue did rise some 17%, but many investors will be looking for more as the company is currently priced at around 34x sales.
FuelCell stock surged at the start of 2021, jumping by about 96% until its January 13 intraday highs of almost $21 per share.
Since then, however, the stock has fallen back down to around $16 per share after a report from JPMorgan questioned the current valuation and assigned a $10 price target for the shares.
The disappointing showing from FuelCell is another bump in the road for hydrogen fuel cell makers of late. Rival fuel cell maker Plug Power saw its shares plunge 7% on Wednesday after Kerrisdale Capital announced a short position and called the hydrogen economy a "fool cell" future.
And on Wednesday, Credit Suisse downgraded another hydrogen rival ,Bloom Energy, to neutral from outperform, sending the stock down over 3%.
Still, FuelCell remained upbeat in their most recent earnings report, noting the benefits of a new, more green-focused, presidential administration.
"Based on the initial policy objectives outlined by the incoming White House administration, we expect clean energy and climate policies in the U.S. to begin to match the pace of advancement seen in other markets such as Europe and Asia, and to be favorable toward the development of the growing hydrogen economy," said Jason Few President and CEO of FuelCell Energy.
Few also noted FuelCell is in a better position financially after recent capital raises allowed the company to "retire high-cost debt."
Shares of FuelCell traded at $15.88 on Thursday morning putting the company's market cap at around $5 billion.