FBR Capital Cuts Price Target as FuelCell Energy (FCEL) is Shut out of Clean Energy RFP
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FBR Capital maintained a Market Perform rating on FuelCell Energy (NASDAQ: FCEL), and cut the price target to $3.00 (from $5.50), following the announced the winners of the Connecticut Department of Energy and Environmental Protection's clean energy RFP. FCEL was not among the winning bids. The company had bid multiple projects of various sizes into the RFP totaling more than 50 MW.
Analyst Carter Driscoll commented, "On October 27, the Connecticut Department of Energy and Environmental Protection (DEEP) privately announced the winners of its 2-20 MW (projects could not exceed 20 MW) clean energy RFP that had 100 bids into the program. Yesterday, the DEEP selected 25 projects totaling 402 MW to move forward with contract negotiations, 11 of which were Connecticut-based projects including nine solar, one wind, and one energy efficiency totaling 170 MW, but excluded any fuel cells projects. FCEL had bid multiple projects of various sizes into the RFP totaling more than 50 MW. Similar to last month when FCEL did not have its Beacon Falls project advance within a tri-state clean energy RFP, we believe the cost of generation was a primary factor in the selection process as wind and solar projects have a lower generation cost. While there are still some near-term catalysts, the loss of Beacon Falls and CT 2-20 MW awards negatively affects our FY17 forecasted revenue and margins, and we have lowered estimates as a result. We are cutting our price target to $3 from $5.50."
Shares of FuelCell Energy closed at $2.75 yesterday.
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