XOM - FuelCell Energy: Relentless Dilution Bodes Well For Preferred Stockholders
2024-06-11 22:14:10 ET
Summary
- FuelCell Energy reported uninspiring Q2/FY2024 results with negative gross margins and significant cash burn.
- With open market sales remaining the company's primary funding source, relentless dilution for common shareholders continued.
- Subsequent to quarter-end, the company signed a $160 million long-term service agreement in Korea, which should boost revenues significantly starting in FY2025.
- While investors should continue to avoid the common shares, the company's Series B Preferred Stock offers a juicy 13.2% dividend yield, for income-oriented investors.
- Considering the company's almost unlimited ability to finance operations via open market sales, I expect FuelCell Energy to honor its preferred dividend obligations for the time being.
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FuelCell Energy: Relentless Dilution Bodes Well For Preferred Stockholders