Let's talk financials then you pathetic fool!!!!!!!!!!!!!!!!!!!!!!!
Weak Financials
FCEL’s loss from operations for the first quarter (ended January 31, 2023) stood at $22.46 million. Its net loss and net loss per share attributable to common stockholders were $19.42 million and $0.05, respectively. Also, its adjusted EBITDA loss widened 6% year-over-year to $14.41 million.
For the same quarter, cash, cash equivalents, and restricted cash declined 16.2% year-over-year to $339.78 million.
2024 STOCK MARKET OUTLOOK
Stretched Valuation
In terms of its forward EV/Sales, FCEL is trading at 4.89x, 207.6% higher than the industry average of 1.59x. The stock’s forward Price/Sales multiple of 6.36 is 411.4% higher than the industry average of 1.24.
Poor Profitability
FCEL’s trailing-12-month EBIT and net income margin are negative 88.77% and 88.92% compared to the industry averages of 9.70% and 6.42%, respectively. Furthermore, the stock’s trailing-12-month asset turnover ratio of 0.16x is 80.6% lower than the industry average of 0.80x.
Disappointing Analyst Estimates
Analysts expect FCEL’s EPS for the fiscal second quarter (ended April 2023) to be negative $0.08. Its revenue for the fiscal third quarter ending July 2023 is expected to decline 23.8% year-over-year to $32.83 million.
Moreover, Street expects the company’s EPS to come in at a negative $0.28 for the current year (fiscal 2023) and a negative $0.26 for the next year (fiscal 2024). Furthermore, the company failed to surpass the consensus EPS estimates in three of the trailing four quarters.
POWR Ratings Reflect A Somber Outlook
FCEL’s weak fundamentals are reflected in its POWR Ratings. The stock has an overall F rating, equating to a Strong Sell in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.
Our proprietary rating system also evaluates each stock based on eight distinct categories. FCEL has a Stability grade of F, in sync with its five-year beta of 3.67.
The stock also has an F grade for Quality, consistent with its poor profitability. FCEL’s higher-than-industry valuation justifies its Value grade of D.
It has a D grade for Sentiment, in sync with the unfavorable bottom-line estimates.
It is ranked #80 within the 91-stock Industrial – Equipment industry.
Beyond what we have mentioned above, to see the other ratings of FCEL (Growth and Momentum), click here.
Bottom Line
Coupled with a challenging macroeconomic environment, FCEL’s weak financials, deteriorating bottom line, and unfavorable estimates are putting pressure on the stock. Hence, it could be wise to avoid this fundamentally weak stock now.
