Project and product expansion, debt and economic concerns, sales increases, and new store openings mark this Wall Street’s week ahead for FuelCell Energy Inc (NASDAQ:FCEL), Canadian Solar Inc. (NASDAQ:CSIQ), Square Inc (NYSE:SQ), and Shake Shack Inc (NYSE:SHAK). Here is a closer look at what analysts are expecting as these companies report earnings.
FuelCell Energy Inc
FuelCell Energy will report its Q1:2016 earnings on Thursday morning. Analysts expect the company to post revenues of $35.21 million for the quarter and a loss of ($0.28) per share, compared to revenues of $41.67 million and a loss of ($0.24) per share for the same quarter of last year.
In the first quarter, the company received council approval for a Beacon Falls, CN energy project, the world’s largest to date. The project is expected to start by the end of 2016 and be completed in 2019. Following the announcement, analyst Jeff Osborne of Cowen & Co weighed in on the stock on January 8, 2016, with an Outperform rating and $23 price target. He stated, “We expect the total value to FuelCell Energy to be close to $500 million.” He continued, “We see this project as a huge win for the company.”
Similarly, the company signed a 20 year partnership to build a 5.6 megawatt power plant for a Pfizer research facility in Connecticut. Analyst Carter Driscoll of FBR commented on the recent deals on January 8, reiterating an Outperform rating and $8 price target. He states, “FuelCell is capturing an increasing share of the distributed power generation market with its stationary fuel cells as multi-megawatt (MW) projects grow in number and size. While we recognize that state and local regulatory processes will influence the timing and execution of FuelCell’s order flow, the company is branching out into new opportunities, such as capturing carbon at U.S. coal-fired plants and selling distributed hydrogen for industrial applications.”
According to TipRanks’ statistics, both analysts who have rated the company in the past 3 months gave a Buy rating. The average 12-month price target for the stock is $15.50, marking a 142% upside from where shares last closed.
Canadian Solar Inc.
Canadian Solar is expected to report its Q4:15 earnings on Thursday, March 10 before market open. Analysts expect $1.04 billion in revenue for the quarter and earnings of $0.76 per share, compared to revenues of $956.15 million and earnings of $1.28 per share for the same quarter of last year.
The company has recently increased expansion efforts in emerging markets and countries in Europe, specifically Germany, which is committed to avoiding the use of nuclear plants. The company has also secured credit facilities and loan agreements to expand projects in the U.S. and Japan. Analysts will be looking to see how the company balances its debt, as peers such as SunEdison and SolarCity have come under investor scrutiny for increasing levels of debt. Analysts will also be watching for the effects of the Chinese economic slowdown, as most of the company’s manufacturing is done in China.
Last month, the company issued preliminary Q4 results which indicated growth in revenue, shipments, and 2016 guidance. Following this announcement, analyst Carter Driscoll of FBR & Co. weighed in on the stock on February 16, 2016, with an Outperform rating and $32 price target. He stated, “Canadian Solar preannounced positive 4Q15 results for all key financial metrics. The company also raised 2016 guidance, which reaffirms our view that Canadian Solar commands a market-leading module position diversified by geography and a growing grid-scale solar development platform. We would expect the stock to react positively on the solid 4Q15 beat and the increased 2016 guidance.”
According to TipRanks’ statistics, all 4 analysts who have rated the company in the past 3 months gave a Buy rating. The average 12-month price target for the stock is $35.67, marking a 58% upside from where shares last closed.
Square is set to release its Q4:15 earnings on Wednesday, March 9, after market close. This will be the first earnings release since its IPO. For this report, analysts are looking for efforts in the company’s non-payments business, as payments make up 95% of the company’s revenues. The company has recently boosted expansion efforts for Square Capital and Square Payroll to appeal to businesses of all sizes. Square has also made initiatives to expand to more small businesses, covering additional states with its payroll product. The company also reported a high retention rate for its payroll product since its release in June.
In the wake of Twitter leadership changes, analysts are questioning CEO Jack Dorsey’s time allocation between Twitter and Square. Analysts are also watching for how the company handles security issues related to its products, such as credit card fraud. The question that remains in both analysts’ and investors’ minds is whether Square can maintain its innovation in the payments sector.
Prior to earnings, analyst Josh Beck of Pacific Crest initiated coverage on the company on February 29, 2016 with a Sector Weight rating and $10 price target. He states, “Square’s next critical milestones are monetizing unique data assets beyond payments and pivoting up market. While we are constructive on the core processing opportunity, our optimism is balanced by the market’s high expectations for execution and the nascency of lending and software initiatives.” He continues, “Penetration, expansion and mainstream usage should sustain net revenue retention of 110%-plus in a segment with above-average churn. We are optimistic that Square can continue to add several hundred thousand customers per year and generate upside to our 2016 estimates. However, the bar is high…and we are cautiously biased on meaningful upside given the success required in execution, lending and software.”
According to TipRanks’ statistics, out of the 10 analysts who have rated the company in the past 3 months, 5 gave a Buy rating and 5 remain neutral. The average 12-month price target for the stock is $13, marking an 8% upside from where shares last closed.
Shake Shack Inc
Shake Shack will post its fourth quarter earnings on Monday, March 7 after market close. Analysts are expecting the company to post earnings per share of $0.07 and revenue of $50.44 million. In the same quarter of last year, the company posted a loss per share of ($0.05) and revenue of $34.8 million.
Although the fast-casual burger chain has loyal following, shares of the company fell more than 16% in the fourth quarter. Analysts will be looking for strong profit margins and same-store sales increases, or same-Shack sales as the company refers to the metric. Even though some are worried that the increased price of beef will impact sales, others are bullish on the company’s expansion plans.
Shake Shack started in New York and quickly gained a following drawn to its burgers and milkshakes. The chain now exists nationwide, as well as internationally. Recently, new Shack locations opened in Arizona and California. The company has further plans to open new locations in South Korea and analysts are eager to see what expansion plans the company will announce for 2016.
According to TipRanks, one analyst has recently weighed in on the burger chain with a Buy rating.