Analysts Just Shaved Their FuelCell Energy, Inc. (NASDAQ:FCEL) Forecasts Dramatically

Market forces rained on the parade of FuelCell Energy, Inc. (NASDAQ:FCEL) shareholders today, when the analysts downgraded their forecasts for this year. Revenue and earnings per share (EPS) forecasts were both revised downwards, with analysts seeing grey clouds on the horizon.

Following the latest downgrade, the current consensus, from the eleven analysts covering FuelCell Energy, is for revenues of US$127m in 2023, which would reflect a measurable 2.5% reduction in FuelCell Energy's sales over the past 12 months. Losses are presumed to reduce, shrinking 18% from last year to US$0.29. Yet prior to the latest estimates, the analysts had been forecasting revenues of US$146m and losses of US$0.24 per share in 2023. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a serious cut to their revenue forecasts while also expecting losses per share to increase.

Check out our latest analysis for FuelCell Energy

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. One more thing stood out to us about these estimates, and it's the idea that FuelCell Energy's decline is expected to accelerate, with revenues forecast to fall at an annualised rate of 2.5% to the end of 2023. This tops off a historical decline of 1.6% a year over the past five years. Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 8.9% annually. So it's pretty clear that, while it does have declining revenues, the analysts also expect FuelCell Energy to suffer worse than the wider industry.

The Bottom Line

The most important thing to take away is that analysts increased their loss per share estimates for this year. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. Given the serious cut to this year's outlook, it's clear that analysts have turned more bearish on FuelCell Energy, and we wouldn't blame shareholders for feeling a little more cautious themselves.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At Simply Wall St, we have a full range of analyst estimates for FuelCell Energy going out to 2025, and you can see them free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.