Alternative energy play FuelCell Energy (NASDAQ:FCEL) reports fiscal Q4 and full-year 2006 earnings results on Monday afternoon. Want to know what Wall Street expects to see? Read on. Want to know what really matters? Read on a bit more.

What analysts say:

  • Buy, sell, or waffle? Eight analysts now follow FuelCell. Half think you should buy it, while two say hold, and two more say sell.
  • Revenues. On average, they're looking for 14% sales growth tomorrow, to $9.1 million.
  • Earnings. FuelCell's losses are predicted to contract to $0.35 per share.

What management says:
 Back in September, CEO R. Daniel Brdar termed FuelCell's third fiscal quarter a success, as the company "continued to successfully execute on our strategy to drive down product costs, deliver reliable, ultra-clean power to a growing customer base, and increase market penetration in targeted applications and geographies." (Notice how there was no mention of growing revenues or turning a profit in there.)

What management does:
Lose money -- that's what FuelCell does. This is normally where we put a table of rolling margins to see how things are going. Let's put it this way: the numbers are bad and they don't really give us any useful information.

One Fool says:
FuelCell backers and alternative energy enthusiasts will undoubtedly reply that FuelCell is too young a company, and doing work that is too important to be expected to turn a profit. Perhaps. And I must admit that the list of accomplishments the firm touted last quarter -- from the 20% improvement in power output from its stacks, to the reduction in cost per kilowatt hour for its plants, to its continued ability to win research grants from the Defense Department and Office of Naval Research -- impress.

That said, with margins remaining in the deep south, revenues choppy and not obviously growing, and profitability nowhere in sight, I continue to think that FuelCell is not the kind of company that an individual investor should finance. Venture capitalists, strategic industrial investors, and Richard Branson, yes -- they've all got deep pockets and can afford to fund FuelCell from here to eternity-minus-one-day, in hopes that on that day, the firm will break even. Meanwhile, they advance the cause of science by pouring private funds into scientific research.

Individual investors, on the other hand, should stick to investing in companies that are -- or that have a reasonable chance of soon -- earning a profit. Anything else is just gambling.

Competitors:

  • Ballard Power (NASDAQ:BLDP)
  • Caterpillar (NYSE:CAT)
  • Cummins (NYSE:CMI)
  • GE (NYSE:GE)
  • McDermott (NYSE:MDR)
  • Plug Power (NASDAQ:PLUG)

What did we expect to see at FuelCell last quarter, and what did it produce? Find out in:

Eighty Motley Fool CAPS players pick FuelCell to outperform the market. Sixty-two say it will underperform. Where do you stand? Join more than 17,000 fellow investors in the Fool's new stock-rating service and let your voice be heard .

Fool contributor Rich Smith does not own shares of any company named above.