Power One (PWER) and FuelCell Energy (FCEL) Critical Review

Power One (NASDAQ: PWER) and FuelCell Energy (NASDAQ:FCEL) are both renewable energy equipment & services – nec companies, but which is the better investment? We will compare the two companies based on the strength of their profitability, institutional ownership, analyst recommendations, dividends, risk, earnings and valuation.

Profitability

This table compares Power One and FuelCell Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Power One N/A N/A N/A
FuelCell Energy -78.60% -52.75% -16.97%

Analyst Ratings

This is a summary of recent recommendations and price targets for Power One and FuelCell Energy, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Power One 0 0 0 0 N/A
FuelCell Energy 0 4 3 0 2.43

FuelCell Energy has a consensus price target of $2.90, suggesting a potential upside of 67.63%.

Insider & Institutional Ownership

14.6% of FuelCell Energy shares are held by institutional investors. 1.2% of FuelCell Energy shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Power One and FuelCell Energy’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Power One N/A N/A N/A $0.26 N/A
FuelCell Energy $108.25 million 1.12 -$50.95 million ($1.44) -1.20

Power One has higher earnings, but lower revenue than FuelCell Energy. FuelCell Energy is trading at a lower price-to-earnings ratio than Power One, indicating that it is currently the more affordable of the two stocks.

About Power One

Power-One, Inc. (Power-One), is a designer and manufacturer of inverters for the renewable energy industry. It makes alternating current/direct current (AC/DC) and direct current/ direct current (DC/DC) power supplies, converters, and power management products for the servers, storage, networking, network power systems and industrial markets. The Company operates in two business segments: Renewable Energy Solutions segment and Power Solutions segment. Renewable Energy Solutions offers inverters and accessories for the photovoltaic/solar and wind markets. The Power Solutions segment represents the Company’s products for AC/DC, DC/DC and digital power conversion, including power conversion products for data centers, such as servers, storage and networking, as well as telecom and industrial power conversion products. In July 2013, Power-One Inc. was acquired by ABB Ltd.

About FuelCell Energy

Fuelcell Energy, Inc. delivers fuel cell power solutions. The Company is engaged in designing, manufacturing, installing, operating and maintaining fuel cell power solutions. The Company also provides turnkey power generation solutions to the customers, including power plant installation, operations and maintenance. The Company’s segment is fuel cell power plant production and research. The Company offers its services to various sectors, including utility companies, municipalities, universities, government entities and a range of industrial and commercial enterprises. The Company, by utilizing its Direct FuelCell (DFC) plants, is commercializing a tri-generation distributed hydrogen configuration that generates electricity, heat and hydrogen for industrial and/or transportation uses, as well as a fuel cell carbon capture solution for coal or gas-fired power plants. The Company is also developing and commercializing solid oxide fuel cell (SOFC) plants for sub-megawatt applications.

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