In a research report released today, FBR analyst Carter Driscoll reiterated an Outperform rating on shares of FuelCell Energy Inc (NASDAQ:FCEL), with a price target of $9.00, after the company missed fiscal second-quarter forecasts on lower revenue, and various one-time expenses. The company posted F2Q16 revenue and EPS of $28.6m and ($0.56), compared to consensus estimates of $35.0m and ($0.40), respectively.

Driscoll wrote, “We are more cautious, near term, as project awards are slower to materialize, but we believe they will come. Weak F2Q16 results partly reflect the ongoing transition to more sale/leaseback projects, low-margin component kit sales to POSCO (which end in F4Q16), $2M in nonrecurring charges for rectifying past service contracts (hurt service margins, but should be over), and higher-than-expected product investments. Due to slower-than-expected awards from multiple RFPs that FCEL bid into in F1H16, the company cut FY16 guidance, from $170M–$210M, to $140M– $170M. We view this as a timing problem, not a demand issue.”

“With 125MW worth of competitive bids over multiple potential projects, there is no shortage of demand; we believe FCEL stands to win at least a substantial portion of them. But the timing of awards appears tilted towards the latter part of FY16 rather than towards the current quarter,” the analyst continued.

According to, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Carter Driscoll has a yearly average return of -12.5% and a 35% success rate. Driscoll has a 39.6% average return when recommending FCEL, and is ranked #3790 out of 3990 analysts.

As of this writing, all the 3 analysts polled by TipRanks rate Fuelcell Energy stock a Buy. With a return potential of 146%, the stock’s consensus target price stands at $14.67.

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