Fuel Tech Story

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FTEK -- USA Stock  

USD 0.66  0.03  4.35%

Fuel Tech is scheduled to announce its earnings today. The next earnings report is expected on the 11th of November 2020. Fuel Tech Enterprise Value is decreasing as compared to previous years. The preceding year's Enterprise Value was reported at 8.74 Million. The current Invested Capital is estimated to increase to about 18 M, while Earnings before Tax are projected to decrease to (8 M). As many passive investors are finally getting excited about industrials space, Fuel Tech could be a good starting point. We will concentrate on if it could be a much better year for Fuel Tech shareholders.
Published over a month ago
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Chances of Fuel Tech (NASDAQ:FTEK) to plunge in September
The company currently holds 1.08 M in liabilities with Debt to Equity (D/E) ratio of 0.05, which may suggest Fuel Tech is not taking enough advantage from borrowing. Fuel Tech has a current ratio of 4.3, suggesting that it is liquid enough and is able to pay its financial obligations when due. About 29.0% of the company shares are held by company insiders. Fuel Tech has price-to-book (P/B) ratio of 1.08. Some equities with similar Price to Book (P/B) outperform the market in the long run. The entity recorded a loss per share of 0.38. The firm had not issued any dividends in recent years.
Fuel Tech financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of Fuel Tech, including all of Fuel Tech's outstanding debt obligations, and compares it with the equity. In simple terms, the high financial leverage means the cost of production, together with running the business day-to-day, is high, whereas, lower financial leverage implies lower fixed cost investment in the business and generally considered by investors to be a good sign. So if creditors own a majority of Fuel Tech assets, the company is considered highly leveraged. Understanding the composition and structure of overall Fuel Tech debt and outstanding corporate bonds gives a good idea of how risky the capital structure of a business is and if it is worth investing in it. Please read more on our technical analysis page.

Watch out for price decline

Please consider monitoring Fuel Tech on a daily bases if you are holding a position in it. Fuel Tech is trading at a penny-stock level, and the possibility of delisting is much higher compared to other equities. However, just because the stock is trading under one dollar, does not mean it will be marked for deletion. Most exchanges require public instruments, such as Fuel Tech stock to be traded above the $1 level to remain listed. If Fuel Tech stock price falls below $1 for 30 consecutive trading days, the exchange can delist it. Once the company reaches this point, they will be sent an initial price violation notice directly from an exchange.

Understanding Fuel Tech Total Liabilities

Fuel Tech liabilities are broken down into two parts on the balance sheet. These are short-term (or current) obligations and long-term debt. Fuel Tech has to fulfill its short-term liabilities in this reporting year and should be no more than 12 months old. Long-term debt, on the other hand, is anything beyond the 12-month payment timeframe. Common short-term liabilities found on Fuel Tech balance sheet include debt obligations and money owed to different Fuel Tech vendors, workers, and loan providers. Below is the chart of Fuel Tech short long-term liabilities accounts currently reported on its balance sheet.
You can use Fuel Tech financial leverage analysis tool to get a better grip on understanding its financial position

How important is Fuel Tech's Liquidity

Fuel Tech financial leverage refers to using borrowed capital as a funding source to finance Fuel Tech ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Fuel Tech financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between Fuel Tech's total debt and its cash.

Breaking down Fuel Tech Indicators

The entity reported the previous year's revenue of 24.09 M. Net Loss for the year was (9.14 M) with profit before overhead, payroll, taxes, and interest of 10.83 M.

Liabilities Breakdown

Current Liabilities
Long-Term Liabilities
Total Liabilities6.21 Million
Current Liabilities5.04 Million
Long-Term Liabilities986,096
Tax Liabilities157,950

Some Fuel Tech technical indicators suggest correction

The treynor ratio is down to 1.15 as of today. Fuel Tech is displaying above-average volatility over the selected time horizon. Investors should scrutinize Fuel Tech independently to ensure intended market timing strategies are aligned with expectations about Fuel Tech volatility. Fuel Tech is a potential penny stock. Although Fuel Tech may be in fact a good instrument to invest, many penny stocks are speculative in nature and are subject to artificial price hype. Please make sure you totally understand the upside potential and downside risk of investing in Fuel Tech. We encourage investors to look for the signals such us email spams, message board hypes, claims of breakthroughs, volume upswings, sudden news releases, promotions that are not reported, or demotions released before SEC filings. Please also check biographies and work history of current and past company officers before investing in high volatility instruments, penny stocks, or equities with microcap classification. You can indeed make money on this equity instrument if you perfectly time your entry and exit. However, remember that penny stocks that have been the subject of an artificial hype usually unable to maintain its increased share price for more than just a few days. The price of a promoted high volatility instrument will almost always revert back. The only way to increase shareholder value is through legitimate performance backed up by solid fundamentals.

The Current Takeaway on Fuel Tech Investment

Although some other firms under the pollution & treatment controls industry are still a bit expensive, Fuel Tech may offer a potential longer-term growth to traders. While some traders may not share our view we believe that the current risk-reward utility is not appealing enough to do any trading. Please use our equity advice module to run different scenarios to ensure your current risk level and investment horizon are fully reflective of your current investing preferences in regards to Fuel Tech.

About Contributor

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Raphi Shpitalnik do not own shares of Fuel Tech. Please refer to our Terms of Use for any information regarding our disclosure principles.

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