FuelCell cut to Market Perform at Cowen but strong 2014 potential seen

|About: FuelCell Energy, Inc. (FCEL)|By:, SA News Editor

FuelCell Energy (FCEL -3.6%) is downgraded to Market Perform from Outperform but with a new $2.70 price target, up from $2, at Cowen, which says recently completed fuel cell parks in Connecticut and Korea should open a $12B opportunity, and H1 orders should drive FY 2014 and Q4 revenue and gross margins to EBITDA break-even.

The firm is eyeing a back-half 2014 weighting to shipments, with a higher mix of full power plant projects vs. kit sales helping lift revenue to ~$68M in Q4 vs. $44M in Q1, and lift gross margin to 12% from 4.9%; in addition to volume, production cost improvements include process upgrades such as automated laser welding.

However, fuel cell peers Plug Power (PLUG +18.1%) and Ballard Power (BLDP +8.5%) are bouncing from yesterday's huge losses.