What happened
FuelCell Energy (FCEL 3.38%) stock might be down nearly 20% this year, but it had a much worse year-to-date return last week. Shares of the fuel cell technology company have been soaring this week, rising more than 19% as of early-Friday trading, according to data provided by S&P Global Market Intelligence.
So what
The company has been working to expand clean energy technologies, but it has yet to make money, and investors have been losing patience. In its fiscal first-quarter earnings report, the company said its project backlog was nearly 19% lower than the prior year as of January 31, 2023. The stock was trading near 52-week lows.
But investors piled in this week when FuelCell Energy announced it had received an order from ExxonMobil for its carbon-capture-technology equipment.
Now what
The order included long-lead fuel cell stack module equipment along with engineering support to demonstrate FuelCell Energy's carbon capture at an ExxonMobil facility. If the full-scale prototype performs adequately, a relationship with the energy giant could be very lucrative for FuelCell Energy.
ExxonMobil announced last month that it plans to move further into the carbon-capture business. It said it had entered into a partnership with industrial gas company Linde for future carbon capture and storage. Companies are looking for the technology to help achieve zero emissions, and FuelCell Energy's fuel cell unit design is one tool for reaching that goal.
The prototype order from ExxonMobil gives FuelCell Energy a bigger stage on which to prove the economics of its technology. Although the stock has been hit hard this year, many investors saw this equipment order as a catalyst and a reason to buy shares.
