One stock whose key insiders are making some notable purchases is FuelCell Energy (FCEL), which is engaged in the development and production of stationary fuel cells for commercial, industrial, government and utility customers. It looks like insiders are finding some deep value here since the stock has dropped over 36% so far in 2011.
This company has a current market cap of $185 million and an enterprise value of $157 million. FuelCell isn't a profitable company yet, and its operating cash flow is $37.33 million in the red. Levered free cash flow is $18 million in the red. FuelCell does have a decent amount of cash on its balance sheet at $24 million after you back out their total debt.The chairman of the board just bought 100,000 shares or $132,000 worth of stock at $1.32 per share. The COO and the president and CEO also have stepped up and bought a combined $26,000 worth of stock in the past week. From a technical standpoint, shares of FCEL are currently trading below both its 50-day and 200-day moving averages, which is bearish. That said, the stock also just formed a perfect double-bottom chart pattern at around $1.25 a share, which could be signaling that the stock is done going lower in the shorter-term. If you're looking to buy this stock, I would get long if you see FCEL take out some near-term overhead resistance at around $1.50 a share. A move above that level would get me long as long as you see it occur on strong volume. I would add to any long position if FCEL trades back above its 200-day moving average of $1.63 a share. It's worth noting that FCEL has a very high short interest at 9.6% of the tradable float. The bears have also been increasing their bets from the last reporting period by 17.1%, or by about 1.4 million shares. This stock could easily short squeeze back to its June high of $1.97 if it gets back above its 200-day moving average soon. >> Get your technical analysis on the go with TheStreet's iPad app.
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