Please ensure Javascript is enabled for purposes of website accessibility

Why FuelCell Energy Stock Just Slid 17%

By Rich Smith – Sep 10, 2020 at 12:22PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Sales beat expectations in the company's fiscal Q3, but declined. And on the bottom line, its loss was worse than expected.

What happened

Shares of alternative energy pioneer FuelCell Energy (FCEL 0.59%) were in freefall Thursday morning, sliding by 17% through 11:45 a.m. EDT after it reported a sales beat -- but an earnings miss.

Analysts had predicted that the hydrogen fuel cell company would lose $0.06 per share on $16 million in sales for its fiscal 2020 third quarter, which ended July 31. As it turned out, FuelCell beat the revenue goal, reporting $18.7 million in sales, but its loss was $0.07 per share.  

Glowing red stock chart arrow trending down

Image source: Getty Images.

So what

Worse, even that revenue "beat" was kind of underwhelming. In fiscal 2019's Q3, FuelCell delivered sales of $22.7 million -- so the $18.7 million it collected last quarter actually represented an 18% year-over-year decline.  

And that's actually the good news, relatively speaking, because FuelCell's bottom-line loss of $15.3 million was way worse -- nearly triple what it lost a year ago. The only reason the loss per share declined from $0.18 to $0.07 was because FuelCell has diluted its shareholders significantly in the interim, resulting in about more 50% more shares outstanding this year than last.

Oh, and pre-tax operating losses jumped 10-fold, to $10.8 million.

Now what

CEO Jason Few tried to put an upbeat spin on the results, saying he is "excited about our progress toward fulfilling our purpose of enabling a world empowered by clean energy." But investors clearly weren't as enthused.

And based on these numbers, I can't really blame them.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

FuelCell Energy, Inc. Stock Quote
FuelCell Energy, Inc.
$3.41 (0.59%) $0.02

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 10/02/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.