The stock soared as much as 20.8% early in the session, before paring gains to close up 10.2%. Trading volume swelled to 67.2 million shares, compared with full-day average of about 18.1 million shares.
The shares have run up 25.9% amid a three-day win streak.
“After many years of investment and cash-burn, the company, with a recently-strengthened balance sheet, now seems poised to pivot into profitability by converting project backlog into recurring revenues, and drive strong long-term growth from accelerating adoption of distributed generation solutions, and early-stage adoption of Carbon Capture and Hydrogen-based energy storage solutions,” Coster wrote in a note to clients.
He said that while the market opportunity for the company is in the early stages, he believes it is “massive.” The company, which Coster said has over $1.3 billion of firm backlog in hand and nearly 50 megawatts of projects, is pursuing a market estimated to be valued at more than $170 billion with over 20 gigawatts of capacity.
He thinks FuelCell will “inflect into profitability” in 2022. Meanwhile, the FactSet consensus for the fiscal year ending October 2022 is for a per-share loss of 22 cents.
For the time being, Coster said the stock, which is currently trading on a multiple of revenue, looks cheaper than shares of rival Ballad Power Systems Inc. BLDP,
Coster’s fair value estimate for the stock is about 26% above Thursday’s closing price.
FuelCell stock’s current win streak comes after the stock closed at a near five-month low of $1.89 on Monday, following allegations by short seller Night Market Research that the company failed to disclose in a fundraising completed last week that it lost two contracts in it backlog. The started started bouncing after the company said the short-seller report contained ‘factual inaccuracies,’ saying the lost contracts were never part of its backlog.
FuelCell’s stock has lost 5.2% year to date, while Ballard Power shares have soared 145.8%, Plug Power’s stock has rocketed 465.8% and Bloom Energy’s stock has run up 176.0%. Meanwhile, the S&P 500 index SPX,