Cowen and Company are offering commntary on FuelCell (Nasdaq: FCEL) following the company's Q4 report on Tuesday night. The firm has FuelCell at Outperform with a price target of $3.

Analyst Jeffrey Osborne said:

Revenue for the quarter was up 26% since Q3, with the following break down by division:

• Product Sales: $42.4 mn - $35.8 mn in power plant revenue, and fuel cell module and kit sales; $6.6 mn in power plant component sales and site engineering and construction. Product segment revenue was up 17% y/y for the quarter.
• Service and Licensing: $6.7 mn - when accounting for the later-revised multi-year recognition of the POSCO-related contract of $10.2 mn in Q4 FY13, the segment was up 29% y/y for the quarter.
• Advanced Technologies: $5.3 mn - up 47% y/y for the fiscal quarter.

The company acknowledged recent and upcoming activity, including a 3.4 MW utility multi-year contract with United Illuminating, a record 70 MW of production for the full fiscal year, and the submission of multiple RFPs for the Long Island Power Authority's (LIPA) 280 MWs of renewable power generation projects. Each project that FuelCell Energy submitted is for a 19.6 MW fuel cell park. The company is a finalist for consideration and was requested by LIPA to submit "Best and Final" offers. Those offers have been submitted, and if accepted would see project construction begin in 2015 with completion in 2016. RFP bidding-related expenses contributed to the y/y increase in operating costs. The company also emphasized projects being developed for on-site behind-the-meter applications, ranging from 1.4 MWs to 14.0 MWs in size as well as multi-megawatt utility grid support projects.

Operationally, the company recently announced the multi-year expansion of its North American manufacturing facility, which is expected to further enhance cost reduction efforts; the first phase will be aimed at supporting a 200 MW annual capacity, and will be paced along with growth in backlog, which totaled $333.9 mn as of the end of October, 2014.

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FuelCell Energy closed at $1.54 yesterday.