Followers | 23 |
Posts | 8743 |
Boards Moderated | 2 |
Alias Born | 08/17/2015 |
![](http://investorshub.advfn.com/images/default_ih_profile2_4848.jpg?cb=0)
Tuesday, November 08, 2016 1:24:58 PM
Clean Energy: Incomplete Investment Picture
Nov. 7, 2016 5:30 AM ET|20 comments | About: Clean Energy Fuels Corp. (CLNE)
Stone Fox Capital Stone Fox CapitalFollow(6,290 followers)
Long/short equity, growth at reasonable price, research analyst, deep value
Send Message|Stone Fox Capital
Summary
Clean Energy Fuels reported dismal key growth metrics for Q3.
The company must generate significantly faster growth for the low margin business to reward shareholders.
The investment picture remains too incomplete to warrant taking on the risk.
Last week, Clean Energy Fuels (NASDAQ:CLNE) delivered dismal Q3 results. The key metrics missed estimates and signaled that the growth opportunity is quickly fading away.
Source: Clean Energy website
The stock plunged nearly 18% on the news. Now trading below $3.50, does the Clean Energy offer any reason to hold out hope of the natural gas fuels company.
As my recent research highlighted, the Clean Energy investment story is ultimately about growing gallons delivered. While the company tried to spin the quarterly results as good, the company only grew gallons delivered by a meager 5%. The gallons only grew 1.9% sequentially from 82.0 million.
Source: Clean Energy Q316 earnings release
As usual, management spent the earnings call proclaiming the excitement over the amount of additional fueling stations, but Clean Energy fails to disclose the comp sales figures for the fueling stations. The key to growth and ultimately large profits are the growth in sales from existing stations along with the growth of new stations.
The natural gas fueling company still promotes the new age concept and fails to present the company in the traditional role as a retailer or operator of fueling stations.
Again, the quarterly results are highly difficult to analyze as these Q3 results included a $6.7 million VTEC credit in comparison to nothing last year. The vast improvements in the quarterly loss appears entirely due to the VTEC amounts and the substantially higher shares outstanding.
The key to the investor story remains that Clean Energy generates margins of $0.33 per gallon delivered. In order to overcome a $12.6 million quarterly loss, the natural gas fueling concept needs to grow gallons delivered by over 35 million without growing the SG&A expenses. About the only way to achieve that growth is from expanding sales at existing fueling stations and the basic numbers suggest that isn't occurring.
The key investor takeaway is that due to an incomplete investment picture, the story always appears like a company making progress. The reality is that Clean Energy is growing too slow for a company losing that much money on a quarterly basis.
Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Additional disclosure: The information contained herein is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities. Before buying or selling any stock you should do your own research and reach your own conclusion or consult a financial advisor. Investing includes risks, including loss of principal.
Recent CLNE News
- Clean Energy Opens Renewable Natural Gas Station in Philadelphia - South Jersey Area to Serve Fleets • Business Wire • 06/25/2024 10:30:00 AM
- Municipalities Adopt Cleaner Solutions Inking Agreements with Clean Energy • Business Wire • 06/20/2024 10:30:00 AM
- Clean Energy Expands Boron LNG Plant Capacity to Accommodate Increased Demand for Cleaner Fuel Driven by Pasha Hawaii Container Ships • Business Wire • 06/11/2024 10:30:00 AM
- Clean Energy Expands Fueling Footprint in So. California • Business Wire • 06/04/2024 10:30:00 AM
- Cemex US Signs Renewable Natural Gas Fuel Agreement with Clean Energy to Power Fleet in Southern California • Business Wire • 05/30/2024 10:30:00 AM
- Bi-Partisan Bill Introduced in U.S. Senate to Encourage the Use of Ultra-Low Carbon RNG in Transportation • Business Wire • 05/23/2024 10:30:00 AM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/20/2024 08:46:22 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/20/2024 08:42:00 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/20/2024 08:37:33 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 05/20/2024 08:08:50 PM
- Form S-8 - Securities to be offered to employees in employee benefit plans • Edgar (US Regulatory) • 05/16/2024 09:30:14 PM
- Clean Energy and Maas Energy Works Join Forces to Build Nine Renewable Natural Gas Dairy Production Facilities Across Seven States • Business Wire • 05/14/2024 10:30:00 AM
- Form 10-Q - Quarterly report [Sections 13 or 15(d)] • Edgar (US Regulatory) • 05/09/2024 08:16:18 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 05/09/2024 08:10:54 PM
- Clean Energy Reports Revenue of $103.7 Million and 58.0 Million RNG Gallons Sold for the First Quarter of 2024 • Business Wire • 05/09/2024 08:05:00 PM
- Clean Energy Announces First Injection of Renewable Natural Gas at Victory Farms Dairy • Business Wire • 04/23/2024 10:30:00 AM
- Clean Energy to Report First Quarter 2024 Financial Results on May 9; Conference Call to Follow at 1:30 p.m. Pacific Time • Business Wire • 04/12/2024 12:00:00 PM
- Clean Energy Appoints Patrick J. Ford to Board of Directors • Business Wire • 03/28/2024 10:30:00 AM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 03/06/2024 11:53:38 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 03/06/2024 11:51:49 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 03/06/2024 11:50:25 PM
- Clean Energy Reports Revenue of $106.9 Million and 57.0 Million RNG Gallons Sold for the Fourth Quarter of 2023 • Business Wire • 02/27/2024 09:05:00 PM
- Clean Energy Turns DFW Area into a Renewable Natural Gas Hub • Business Wire • 02/26/2024 11:30:00 AM
- Clean Energy’s Renewable Natural Gas Facility at Marshall Ridge Dairy in Iowa Begins Production • Business Wire • 02/14/2024 11:30:00 AM
- Clean Energy’s Renewable Natural Gas Digester at Tri-Cross Dairy Begins Production • Business Wire • 02/08/2024 11:30:00 AM
Glidelogic Corp. Becomes TikTok Shop Partner, Opening a New Chapter in E-commerce Services • GDLG • Jul 5, 2024 7:09 AM
Freedom Holdings Corporate Update; Announces Management Has Signed Letter of Intent • FHLD • Jul 3, 2024 9:00 AM
EWRC's 21 Moves Gaming Studios Moves to SONY Pictures Studios and Green Lights Development of a Third Upcoming Game • EWRC • Jul 2, 2024 8:00 AM
BNCM and DELEX Healthcare Group Announce Strategic Merger to Drive Expansion and Growth • BNCM • Jul 2, 2024 7:19 AM
NUBURU Announces Upcoming TV Interview Featuring CEO Brian Knaley on Fox Business, Bloomberg TV, and Newsmax TV as Sponsored Programming • BURU • Jul 1, 2024 1:57 PM
Mass Megawatts Announces $220,500 Debt Cancellation Agreement to Improve Financing and Sales of a New Product to be Announced on July 11 • MMMW • Jun 28, 2024 7:30 AM