FuelCell Energy Inc (NASDAQ:FCEL) Troubled Times Ahead


Dallas, Texas 06/30/2015 (Financialstrend) – FuelCell Energy Inc (NASDAQ:FCEL) share prices continued to tumble on Monday as well, indicating that the road to recovery is long for this energy technology company.

The decline was waiting to happen, as the company had announced downward revisions in earnings estimates, twice this year. It’s latest earnings results announced on June 8, 2015 too fell below estimated expectations triggering substantial decline in share prices.  The outlook for the current fiscal, along with estimate revisions indicating negative earnings, has led to investor exit, resulting in decline in share prices.

The second-quarter fiscal results saw the company report 4 cents per share loss.  The reason for the decline was attributed to the drop in product sales. Additionally, there was a drop in services as well as license revenues which eventually led to the drop in revenues for the quarter.

However, there was hope, as the one of its key contracts, within the advanced technologies segment, helped the company to overcome the recent fall in revenues.  The total cost of revenues of the company was lower by nearly 27.5%, down to $26.6 million in comparison to same quarter of 2014.

An SEC filing on Friday revealed that FuelCell Energy Inc (NASDAQ:FCEL) Chief Executive Officer, John A. Rolls had bought 140,000 shares in the open market priced at $1.02 per share. The value of the transaction was $142,800.00. The total number of shares held directly by the CEO now stands at 1,108,000 shares with the total value of $1,130,160.

Analyst believe FuelCell Energy Inc (NASDAQ:FCEL) is experiencing these declines as it looks to expand into segments which will garner more margins. A 290 basis points increase in second quarter gross margin was reported, attributing it to the introduction of efficiency in manufacturing. FCEL is expected to mark turnaround, as its Hospital project in California commences, along with a number of other projects.

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