December 15, 2010
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of alternative energy company FuelCell (Nasdaq: FCEL ) charged up as much as 15% in intraday trading on heavy volume.
So what: Investors appear to be reconsidering how they feel about FuelCell's fiscal fourth-quarter earnings report. On Monday, the company announced that its fourth-quarter sales had fallen from $20.4 million last year to $19.7 million. The tally also missed Wall Street estimates, and shares plunged on the news. However, the company's loss per share for the quarter of $0.11 was markedly better than the $0.14 that analysts were looking for. The company also reported that its cost-to-revenue ratio had fallen to 1.21-to-1, which means that it's not losing money quite as fast. It also reported significant growth in backlog.
Now what: FuelCell shareholders are likely pretty happy with today's move, and I'm sure this won't be the last time we see a double-digit percentage gain (or loss), since it's a pretty volatile stock. However, as far as investing in it goes, I think my fellow Fool Anders Bylund summed up the situation pretty well earlier today, when he urged Fools to remember that FuelCell shares are a gamble, not an investment.
Want to keep up to date on FuelCell? Add it to your watchlist.