Why FuelCell Energy Is Poised to Underperform

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, fuel-cell power plant manufacturer FuelCell Energy (NASDAQ: FCEL  ) has received an alarming one-star ranking.

With that in mind, let's take a closer look at FuelCell and see what CAPS investors are saying about the stock right now.

FuelCell facts

   

Headquarters (founded)

Danbury, Conn. (1969)

Market Cap

$212.2 million

Industry

Electrical components and equipment

Trailing-12-Month Revenue

$120.6 million

Management

CEO Arthur Bottone (since 2011)

CFO Michael Bishop (since 2011)

Return on Equity (average, past 3 years)

(63.3%)

Cash/Debt

$57.5 million/$22.6 million

Competitors

Ballard Power Systems (NASDAQ: BLDP  )

Cummins (NYSE: CMI  )

General Electric (NYSE: GE  )

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 48% of the 113 All-Star members who have rated FuelCell believe the stock will underperform the S&P 500 going forward.

Just yesterday, one of those bears, fellow Fool Russell Carpenter (TMFEldrehad), succinctly summed up the underperform case for our community:

I've been bearish on fuel cells in general and this company in particular for almost as long as I've been a member of the CAPS community. The infrastructure challenges are simply too steep to make this technology economically viable anytime soon, and companies in this space will never provide much in the way of meaningful returns to their shareholders so long as this fact remains true.

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Read/Post Comments (4) | Recommend This Article (0)

Comments from our Foolish Readers

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  • Report this Comment On February 15, 2013, at 8:32 AM, Triller wrote:

    What people like your Bear don't remember is that the clean air we aren't breathing that much anymore is because of the oil, coal, fumes that are a byproduct of all our energy needs, which will never go away, and is the primary reason all those standard reasons for investing in companies that provide clean energy for our inexhaustible power needs and will displace all those dirty little power plants around the corner, and why the Asian countries will continue to change the reasons we all depend on coal, oil, and Nuclear energy, all of which will ultimately destroy the earth, the animals and the people who inhabit this finite geological, geographical, ocean o graphicalOoxygen dependent human beings who depend on the aforementioned to survive, thrive, just live. How much would you pay to live, continue to live, to not die because of the vile gases that are slowly encapsulating our environment up to the upper atmospheres, into the water we live on, then into the food we eat, via the water that rains and feeds the plants we grow in the dirt we plant them and ultimately suck up the minerals and water into their plantlives that feed us humans, without which we die...Because you can't see it, doesn't mean it doesn't exist. The poisons we feed our plants ultimately feed us, the poisons we leach into our dirt, oceans eventually leach into our lives and our bodies. We will die a painful, cancerous death induced by these new diseases we find out about every year, why???why do you think? You are what you eat.....

  • Report this Comment On February 15, 2013, at 10:10 AM, Stymie67 wrote:

    Note the FCEL competitors listed in the article, then note what stocks MF owns in their disclaimer. LOL

    The article merely makes a blanket statement about the infrastructure challenges. Actually there's a lot more going on. Very thin analysis here.

  • Report this Comment On February 15, 2013, at 8:46 PM, jaketen2001 wrote:

    Yeah FCEL, you hear that! Ha! Piping natural gas is a killer! You have no chance! It has killed the um, natural gas industry, too! Errrrrrrr, wait.

    Yeah, errrrrrr, there is a special middle earth, where there is no existing natural gas network, or eerrrrrrr, FCEL's SOFCs can't just run off of the katrillion natural gas pipelines because, ummmmmm, you need to filter out the unicorn dust. So there!

    For the author's benefit, FCEL's products are installed in centralized multiple MW locations. They run on ubiquitous natural gas, and they feed electricity in to the grid. While other fuel cell companies involved in motive products that may need to fuel up on hydrogen do experience infrastructure challenges, FCEL is not one of them.

  • Report this Comment On February 18, 2013, at 11:33 AM, jimbob50 wrote:

    Triller and Stymie67 are both spot on.People need to wake up and smell the coffee . FCEL is at least a hugh part of the answer.

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