Boston, MA 03/28/2014 (wallstreetpr) – During the dot-com boom in and around 2000, FuelCell Energy Inc (NASDAQ:FCEL) traded as high as $48.11. FuelCell has traded below the $4 mark for most of the time since October 2009. The high so far this year was on March 11 when it went above the $4 mark during the morning before it finished the day below $4.
That was the same day when Plug Power Inc (NASDAQ;PLUG) also hit a high for this year and traded above $11 for the only time this year. Clearly, both companies appear to be joined at the hips. Plug Power is a well-known speculative and casino stock that analysts have trashed. It’s worth noting though that the all-time highs of $48 for FuelCell Energy Inc (NASDAQ:FCEL) are nowhere near as crazy as the highs of nearly $1,500 that the Plug stock had reached during the dot com bubble.
Is FuelCell For Real?
FuelCell Energy Inc (NASDAQ:FCEL) has built up a substantial business over the years. It reported 1Q2014 revenues of $44.4 million, compared to $36.4 million for 1Q2013. It reported a profit of $2.2 million in 1Q2014 compared to a loss of $2.3 million in 1Q2013.
On the other hand, the total backlog as on January 31, 2014 declined to $326.8 million from $428.3 million on January 31, 2013.
Outlook
While renewable energy still has many backers — and the need for reducing CO2 emission is buttressed with growing evidence of climate change from all corners of the scientific community — every business in the renewable energy sector cannot be a Tesla Motors Inc (NASDAQ:TSLA).
Humans tend to focus on short term gains and are driven to go for products that are “cheap” — whether it is garments made in Bangladesh or cheap gasoline. What had given a fillip to the renewable energy sector was the spike in crude oil prices.
But with crude and natural gas prices likely to stay moderate on account of new techniques of exploration and extraction such as fracking, tar sands and shale gas, it becomes tougher to persuade businesses and individuals to opt for renewable energy — such as electric or hybrid cars and roof-mounted solar panels. The ever more destructive hurricanes that arise in the Atlantic with ever increasing frequency, the winters becoming colder than ever, the summers becoming hotter than ever leading to extensive droughts; all this might eventually persuade people that “climate change” is real.
Then the stock of renewable energy will rise again.
