FuelCell Energy Q4 Earnings: Well Positioned for Project Delivery

Small cap fuel cell stockFuelCell Energy Inc (NASDAQ: FCEL) reported Q4 and fiscal year ended October 31, 2017 earningswithQ4 total revenuesbeing $47.9 million versus $24.5 million:

Product sales totaled $39.9 million versus $8.4 million. The increase primarily reflects partial deliveries under a 20 megawatt order to a South Korean construction company for a utility project to be owned by Korea Southern Power Company, with deliveries beginning in the fourth quarter of 2017 and concluding in the first quarter of 2018. Service agreements and license revenue totaled $2.7 million versus $10.7 million.The difference between the periods reflects the timing of scheduled module replacements under service agreements. Generation revenue totaled $1.8 million versus $0.7 million.The increase reflects the growth in the generation portfolio with 11.2 MW operating as of October 31, 2017. Advanced technologies contract revenue totaled $3.5 millionversus $4.7 million.Revenue was lower for the fourth quarter of 2017, reflecting the timing of project milestones under existing contracts.

The Q4 net loss attributable to common stockholderswas $10.8 million versus$13.7 million.Cash, cash equivalents, restricted cash and borrowing ability under the NRG Energy revolving project financing facility totaled $127.4 million as of October 31, 2017 and included total cash of $87.4 million (including $49.3 million of unrestricted cash and cash equivalents and $38.1 million of restricted cash) and $40.0 million of borrowing ability (under the NRG Energy revolving project financing facility). The Company also had a contract backlog totaling approximately $554.2 million as of October 31, 2017 versus $432.3 million as of October 31, 2016.

The CEO commented:

We are well-positioned for delivering projects in 2018 supported by expanding backlog and announced project awards that exceed $1.6 billion. We are continuing to pursue large projects on a global basis.

A technical chart for FuelCell Energy shows conflicting trend lines with shares peaking in October:

A long term performance chart shows shares of FuelCell Energy severely underperforming whilesmall cap alternative energy or fuel cell stocks like Ballard Power Systems Inc (NASDAQ: BLDP), Hydrogenics Corporation (NASDAQ: HYGS) and Plug Power Inc (NASDAQ: PLUG) all peaked in 2014 with some of them showing signs of stabilization andsomepositive growth last year:

Finally, here is a quick recap of small cap FuelCell Energys recent earnings history along with EPS estimate trends from the Yahoo! Finance analyst estimates page:

Earnings History1/30/20174/29/20177/30/201710/30/2017
EPS Est. -0.32 -0.27 -0.23 -0.2
EPS Actual -0.39 -0.33 -0.31 -0.17
Difference -0.07 -0.06 -0.08 0.03
Surprise % -21.90% -22.20% -34.80% 15.00%
EPS TrendCurrent Qtr. (Jan 2018)Next Qtr. (Apr 2018)Current Year (2018)Next Year (2019)
Current Estimate -0.19 -0.19 -0.68 -0.53
7 Days Ago -0.19 -0.18 -0.7 -0.55
30 Days Ago -0.19 -0.18 -0.7 -0.55
60 Days Ago -0.19 -0.18 -0.7 -0.55
90 Days Ago -0.19 -0.18 -0.7 -0.55

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