The shares of FuelCell Energy (NASDAQ: FCEL) are going to have quite a week, if their performance on Monday is any indication. The company’s stock zoomed nearly 7% higher on Monday thanks to a new financing deal. That rate easily bettered the 0.3% increase of the S&P 500 index that day.
New funds incoming
FuelCell announced that it has agreed to a deal in which two local lenders will provide debt financing for a pair of the company’s fuel cell projects. Of the $13 million that is being supplied, Liberty Bank’s senior credit facility is to provide $6.5 million and Connecticut Green Bank $3 million in a subordinated facility. The latter company will also contribute an additional credit facility totaling $3.5 million.
The term of the Liberty Bank facility is seven years, FuelCell added, while that of Connecticut Green Bank’s subordinated financing is 14 years. Their respective interest rates are fixed at 7.25% and 8%. The monies available to the borrower totaled roughly $11.6 million once transaction fees and debt service reserves were accounted for.
The funds will be used in the continuing development of a 14-megawatt fuel cell park and a 2.8-megawatt fuel cell project, both of which are located in the town of Derby, Connecticut. This is within driving distance of FuelCell’s headquarters in the city of Danbury.
Effective, inexpensive, and useful
In the press release trumpeting the new debt facilities, FuelCell quoted its CFO Michael Bishop as saying that the banks’ “efficient and cost-effective financing… highlights their continued confidence they have in the long-term performance of our fuel cell platforms.”
Should you invest $1,000 in FuelCell Energy right now?
Before you buy stock in FuelCell Energy, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and FuelCell Energy wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $537,557!*
Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*.
*Stock Advisor returns as of April 22, 2024
Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
Why Investors Were Energized by FuelCell Energy Stock Today was originally published by The Motley Fool
Signup bonus from
