Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Chairman’s Purchases Fail to Lift FuelCell Energy Shares

On an up day for stock markets generally, there was one surprising loser in Tuesday trading: Alt-energy play FuelCell Energy (NASDAQ:FCEL) saw its shares sink 3.3% despite a 0.6% rise elsewhere on the Nasdaq. This was particularly surprising given that we just learned that FuelCell’s own Chairman of the Board has been actively buying shares — 140,000 of them — and at prices significantly higher than what FuelCell costs today.

Specifically, according to Form 4 filings with the SEC, FuelCell Chairman  John Rolls purchased 140,000 shares of his company on June 26, increasing his stake in the company by more than 14% to 1.1 million shares. Rolls paid $1.02 per share for his purchases. That may not sound like much, but at FuelCell’s current depressed stock price ($0.98), he paid about 4.5% more than it would cost an outside investor to buy those same shares today.

But should you buy them?

What does it mean to you?
It depends on how you look at the numbers. From one perspective, the $25.6 million in losses FuelCell reported over the past 12 months is… well, it’s certainly not good news. But it is better than the $38 million that FuelCell lost last year, or the $34 million it lost the year before that. Broadly speaking, GAAP-reported net losses appear to be trending downwards at FuelCell. Meanwhile, the company has nearly $56 million more cash than debt on its balance sheet, suggesting it may have enough funds to keep it afloat till profits at last turn positive.

Other perspectives are not so optimistic.

For example, free cash flow at the company for the past 12 months has been negative $62.6 million. That’s more than twice FuelCell’s reported losses as calculated under GAAP, and it makes the past 12 months one of the worst such periods for cash-burn at the company in the past five years.

Longer-term, the company hasn’t reported positive net profits since 1997, or positive free cash flow since 1998. Indeed, even investors encouraged by the Chairman’s purchase this week need to consider whether, given its history, FuelCell will ever turn a profit.

Given its record, I kind of doubt that it will.


This $19 trillion industry could destroy the Internet
One bleeding-edge technology is about to put the World Wide Web to bed. And if you act quickly, you could be among the savvy investors who enjoy the profits from this stunning change. Experts are calling it the single largest business opportunity in the history of capitalism… The Economist is calling it “transformative”… But you’ll probably just call it “how I made my millions.” Don’t be too late to the party — click here for one stock to own when the Web goes dark.

Biotech Stock Alert - 20% Guaranteed Return in One Year

Hedge Funds and Insiders Are Piling Into

One of 2015's best hedge funds and two insiders snapped up shares of this medical device stock recently. We believe its transformative and disruptive device will storm the $3+ billion market and help it achieve 500%-1000% gains in 3 years.

Get your FREE REPORT and the details of our 20% return guarantee today.

Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading Comments...

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 102% in 3 years!! Wondering How?

Download a complete edition of our newsletter for free!