What Happened:
Shares of carbonate fuel cell technology developer FuelCell Energy (NASDAQ:FCEL) jumped 11.6% in the morning session after the company reported second-quarter earnings results. FuelCell Energy blew past analysts' revenue expectations. That adjusted EBITDA and EPS came in line with expectations was comforting. On the other hand, its backlog missed. On a more positive note, backlog grew 12% y/y, signaling the potential for the declining revenue growth to reverse in the coming quarters. In addition, the company provided some encouraging updates regarding the demand side of the equation as it plans to diversify its offerings given growing opportunities from AI-driven data centers. Overall, this quarter seemed fine.
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What is the market telling us:
FuelCell Energy’s shares are very volatile and over the last year have had 90 moves greater than 5%. But moves this big are very rare even for FuelCell Energy and that is indicating to us that this news had a significant impact on the market’s perception of the business.
FuelCell Energy is down 71.8% since the beginning of the year, and at $0.44 per share it is trading 75.5% below its 52-week high of $1.78 from December 2023. Investors who bought $1,000 worth of FuelCell Energy’s shares 5 years ago would now be looking at an investment worth $1,173.
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