Tuesday, June 3, 2014

* FuelCell (FCEL) - Earnings Postmortem & How This Growth Story Just Isn't... At All...

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Original publish date: Tuesday, June 3, 2014

FCEL closed trading at $2.37, down small and in extended hours dropped ~15% after earnings. The Symbol Summary is included below.

Provided by Yahoo! Finance

UPDATE 6-11-2014

Provided by Yahoo! Finance

The stock continues to drop...

UPDATE 6-11-2014

Provided by Yahoo! Finance

The stock continues to drop... more ...

Back to Tuesday, June 3, 2014

This is a very quick earnings post-mortem on what has become a retail favorite, somehow lumped in with PLUG and TSLA of all companies.

Fact: The company generated $55M in revenue three quarters ago.

Fact: The company generated $44M in revenue two quarters ago.

Fact: The company generated $38M in revenue in the latest quarter.

Whether you look year-over-year or quarter-over-quarter-over-quarter, this company is shrinking in revenue, gross margins, operating income and net income. It just is.

FuelCell Energy, Inc., together with its subsidiaries, designs, manufactures, sells, installs, operates, and services stationary fuel cell power plants for distributed baseload power generation. It offers Direct FuelCell power plants that electrochemically produce electricity and heat using various fuels, including natural gas, methanol, diesel, biogas, coal gas, coal mine methane, and propane.

First a stock chart (five years).

Provided by Charles Schwab optionsXpress

So, basically, up 500%+ (250% from early February to mid March), then down 50%, then up 20%, and then... whatever happens tomorrow.

The stock is up 86% in the last year.

Earnings Postmortem.  Here. We. Go.

Loss: $16.6M; Last Quarter $7.6M
Loss (EPS): $0.07/share; Last Quarter $0.04/share
Loss Adjusted to Exclude one-time items: $0.04/ share vs. expected $0.03/share.
Revenue: $38.2M (Estimate: $45.2M) down from $42.2M last quarter.
Backlog: $342.6M now; was $326.9M at end of January.
Gross Margins: 4.2% this quarter, down from 5.5% last quarter.

(1) MarketWatch: FuelCell posts wider loss
(2) Benzinga: FuelCell Energy Shares Selling Off On A Weak Second Quarter

The real problem  are the comps.  First, annual for the last four years.

Provided by NASQAQ.com

Pick a profitability ratio, any of them... They're all lower than 2010; substantially so.

But this isn't about the past, it's about the growth story in the last year, right?... No. Here is quarterly data:

Provided by NASQAQ.com

Revenue are not just down this quarter from last, but were also down two quarters ago and are down from five quarters ago.

Revenue, Gross Profit, Operating Income, EBT & NI from Continuing Operations are all down quarter-over-quarter-over-quarter.

This is trade analysis, not a recommendation.

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