FuelCell Shares Popped: What You Need to Know

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.

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Fool contributor Matt Koppenheffer does not own shares of any of the companies mentioned. You can check out what Matt is keeping an eye on by visiting his CAPS portfolio, or you can follow Matt on Twitter @KoppTheFool or on his RSS feed. The Fool’s disclosure policy assures you no Wookiees were harmed in the making of this article.


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  • Report this Comment On December 17, 2010, at 2:01 PM, AnotherGooGoo wrote:

    I still would like to see that you're right.

    At some point everyone is. Just look at charts.

    But the point is to be right at the correct time.

    I was biosed by foolish toughts and nobody forced me to sell right before the report that everyone with a little bit of intelligence new will be right on, or better.

    Still it's my mistake.

    Your foolish opinion.

  • Report this Comment On December 20, 2010, at 9:25 PM, matigen wrote:

    This comment was posted on the 15th. if you listen to this fool, you miss the big rally on the 17th.

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