How FuelCell Energy Hopes to Power Earnings Higher

On Wednesday, FuelCell Energy (FCEL -5.33%) will release its latest quarterly results. But can the long-struggling, fuel-cell-technology company finally give investors what they've been waiting for in its coming report?

FuelCell Energy has gone through some big ups and downs in the past several years, as various opportunities arose but ended up falling short of expectations. Now, though, FuelCell hopes that its latest projects will finally bring it long-awaited success. Let's take an early look at what's been happening with FuelCell Energy over the past quarter and what we're likely to see in its quarterly report.

Stats on FuelCell Energy

Source: Yahoo! Finance.

Can FuelCell Energy's earnings finally get more energetic this quarter?
FuelCell's earnings prospects haven't inspired analysts lately, with their having cut their April-quarter earnings estimates by a penny per share and cut a nickel from their full-year fiscal 2013 consensus views. The stock, though, has been doing well, rising more than 25% since late February.

Arguably the most exciting news for FuelCell this quarter came in early May, when it and Dominion (D -0.39%) broke ground on its Dominion Bridgeport Fuel Cell project in Connecticut. The project is designed to power 15,000 homes, with its power-plant that will convert natural gas into electricity. With Dominion having a 15-year contract to a local utility to provide power, FuelCell should be able to use the project as a long-term showcase for the potential of its products, especially after it becomes operational later this year. Partially as a result of its Bridgeport success, FuelCell announced that it expected to reach an annual run-rate of 70 megawatts, fueling growth in revenue to $38 million-$40 million for the current quarter.

But a potentially even larger market for FuelCell could come from landfill gas. In late February, the company got a contract in western Canada to build a fuel-cell power plant in proximity to a source of cleaned landfill gas. Although the partner involved in the Canadian project isn't very large, U.S. companies Waste Management (WM -0.16%) and Covanta (CVA) have both ramped up their waste-to-renewable-energy presence. Although some of that gas will likely get used in fueling waste-collection trucks, engaging FuelCell Energy to make better use of whatever gas isn't needed for internal use could prove to be an easier solution than building infrastructure to transport the gas elsewhere.

In FuelCell's report, watch for the latest updates on where the company sees its future projects coming from. With so many directions to consider, FuelCell needs to stay focused on those projects with the highest probabilities of success in order to ensure its future prosperity.

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