The Toyota logo is shown in a Mirai fuel cell electric vehicle in Tokyo in December.
Toru Hanai/BloombergDisappointing financial results from Fuel Cell Energy slammed the stock and sent shares of other hydrogen-related companies lower as well.
Fuel Cell (ticker: FCEL) reported $14 million in sales for its fiscal second quarter, down from $14.9 million in the prior quarter and below the $18.9 million reported in the same quarter a year earlier. Wall Street was looking for $18.9 million in sales, so it was a big miss.
The company is one of a number that stand to benefit as fuel-cell technology, using hydrogen to produce electricity without greenhouse-gas emissions, meets a growing share of the world’s energy needs. Fuel Cell makes stationary equipment that competes with traditional generators from the likes of Caterpillar (CAT). Other companies are aiming to use the technology in cars and trucks.
Shares were down about 11% in midday trading. The S&P 500 and Dow Jones Industrial Average, for comparison, were both up roughly 0.3%.
Fuel Cell isn’t profitable yet, and Wall Street doesn’t project profits until 2025, so . earnings matter less than sales. Still, the company reported a loss of 6 cents per share, while analysts were expecting a loss of 5 cents.
Despite the revenue shortfall, CEO Jason Few sounded an upbeat tone on the company’s earnings conference call. “We remain optimistic about the continuing momentum behind the global energy transition and expect to play an important role with our primary technologies,” said Few. He spoke about support from the Biden administration for hydrogen technology as well as opportunities for new business across the globe.
A challenge is that hydrogen, the fuel in a fuel cell, is expensive to produce relative to products such as diesel. Costs need to come down for sellers of fuel- cell technology such as Fuel Cell Energy to take off.
Also falling in response to the Fuel Cell Energy results were Plug Power (PLUG), Nikola (NKLA), and Ballard Power (BLDP). All three want to apply hydrogen fuel-cell technology to applications typically powered by diesel fuel. Those three stocks were down 3%, 3%, and 2%, respectively, in midday trading.
After a big run up in 2020, Fuel Cell Energy stock has been weak so far in 2021. Shares gained 345% in 2020 but are down about 11% year to date, leaving them about 67% below their February 52-week high.
All four hydrogen-technology stocks have struggled lately. The quartet is down 65%, on average, from their 52-week highs.
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June 11, 2021 at 12:22AM
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Fuel Cell Energy Is Dropping. Other Hydrogen Stocks Are Down Too. - Barron's
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