FuelCell Energy (NASDAQ:FCEL) is rising today after receiving an important award. One of the fuel cell technology company’s projects has received the Independent Electricity System Hydrogen Innovation Fund Award from Ontario’s government. Other firms involved in its development include Kinectrics and Bruce Power. But news that the multi-company project has been honored in this way has sent FCEL stock shooting up.
After a week of struggling, this catalyst is very much needed. It could help usher in the turnaround that FuelCell investors have been awaiting. While FCEL stock has made significant progress this month, it remains solidly in the red for the past six. The company needs a jolt to turn things around, and they just might have received it.
Does this mean that this penny stock should be on investor’s watch lists as it prepares to turn a new corner? Let’s dive into the project that has netted this award and assess what it is likely to mean for the company.
What’s Happening With FCEL Stock
As noted, FCEL stock has been on a winning streak since news of the award broke this morning. As of this writing, it is up more than 10% for the day and looks primed to rise even higher. After more than a year of trading below the $5 mark, FuellCell Energy may not look appealing to most investors. But clearly, Ontario’s government believes in the viability of its project. According to a statement released by the company:
“The comprehensive plan submitted by Kinectrics, Bruce Power and FuelCell Energy included performing a techno-economic assessment of hydrogen production as a clean fuel source for heavy-duty vehicles through high-temperature water electrolysis and will explore the use of solid oxide fuel cells for power generation. It will evaluate the economic feasibility, including installation, maintenance and operating costs of hydrogen production, storage, distribution, and power generation infrastructure.”
If this progress continues, it could certainly help boost FCEL stock in the coming months. FuelCell has also noted that it will “serve as a pilot for broader deployment at a larger scale including integrating hydrogen systems with nuclear power plants including Small Modular Reactors.” This seems like a promising start to a chapter that could help demonstrate to investors that FCEL isn’t a stock that should be counted out.
Additionally, as InvestorPlace contributor Ian Cooper notes, FuellCell has enjoyed partnerships with industry-leading companies such as Exxon Mobil (NYSE:XOM) and Toyota Motors (NYSE:TM). Now, it is being recognized by international governments for its innovative work and collaboration. The current momentum it is experiencing could easily continue as investors take notice. FCEL stock is an undervalued growth play on the clean energy sector. It is likely about to be recognized as such.
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On the date of publication, Samuel O’Brient did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.