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FuelCell Energy Turns Higher Despite Wider-Than-Expected Loss

FuelCell Energy, the power-equipment maker, posts a fourth-quarter loss of 8 cents a share.
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FuelCell Energy  (FCEL) - Get FuelCell Energy Inc. Report turned higher Thursday even after the fuel cell power equipment maker reported a wider-than-expected loss in the fourth quarter.

The company reported a loss of 8 cents a share, narrower than a year-earlier loss of 23 cents but wider than forecasts that called for a loss of 4 cents. Operating losses shrank to $17.1 million from $33 million.

Revenue soared 54% in the quarter to $17 million from $11 million and beat Wall Street estimates.

FuelCell shares traded at $17.28, up 3.1%, in trading Thursday. They had traded in the red during the early part of the session.

The power-equipment maker, like many hydrogen-linked stocks, has had an explosive run over the past few months amid demand for cleaner fuels. Many analysts believe, however, that the stocks have run too far too fast.

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FuelCell’s price-to-sales ratio stands at an astronomical level of 50.78 and its price-to-book ratio the same at 56.10, according to Morningstar.

Just last week, J.P. Morgan analyst Paul Coster downgraded the stock to underweight from neutral. Coster has a $10 price target on the Danbury, Conn., power equipment company.

The stock more than quadrupled in 2020. And in 2021 through Wednesday Jan. 13 it rose 71%. 

"We think the stock is richly valued here," Coster said.

In the same note, Coster initiated coverage of peer hydrogen fuel cell maker Plug Power  (PLUG) - Get Plug Power Inc. Report with a hold rating and a $60 price target. Plug recently traded at $59.36, down 5.02%, and has taken off 284% over the three months through Wednesday.