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Fuel Tech (FTEK)
NASDAQ:FTEK

Fuel Tech (FTEK) AI Stock Analysis

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Fuel Tech

(NASDAQ:FTEK)

Rating:54Neutral
Price Target:
$2.00
▲(9.29%Upside)
The overall stock score reflects significant financial challenges, as evidenced by declining revenues and profitability issues. While technical indicators show bullish momentum, valuation remains a concern with ongoing losses. Positive earnings call highlights provide some optimism, but a strategic turnaround is needed for sustained growth.
Positive Factors
Financial Position
The company holds $31.2M in cash with no debt, highlighting a strong financial position.
Market Opportunities
Order wins in the data center market are expected to be significant catalysts for growth.
Revenue Growth
Revenues for the FUEL CHEM segment grew by 93% year-over-year, indicating strong performance and demand.
Negative Factors
Revenue Outlook
Revenues for 2024 came in toward the lower end of the company’s guided range due to delayed projects and timing of APC awards.

Fuel Tech (FTEK) vs. SPDR S&P 500 ETF (SPY)

Fuel Tech Business Overview & Revenue Model

Company DescriptionFuel Tech, Inc. provides boiler optimization, efficiency improvement, and air pollution reduction and control solutions to utility and industrial customers worldwide. It operates through two segments, Air Pollution Control Technology and FUEL CHEM Technology. The Air Pollution Control Technology segment offers technologies to reduce nitrogen oxide (NOx) emissions in flue gas from boilers, incinerators, furnaces, and other stationary combustion sources by low and ultra-low NOx burners; over-fire air systems; NOxOUT and HERT selective non-catalytic reduction systems; selective catalytic reduction systems comprising ammonia injection grid, and graduated straightening grid systems; I-NOx systems; ESP Processes and Services; ULTRA technology; and flue gas conditioning systems; and burner systems. The FUEL CHEM Technology segment provides programs to improve the efficiency, reliability, fuel flexibility, boiler heat rate, and environmental status of combustion units by controlling slagging, fouling, corrosion, opacity, and acid plume, as well as the formation of sulfur trioxide, ammonium bisulfate, particulate matter, sulfur dioxide, and carbon dioxide through the addition of chemicals into the furnace using TIFI targeted in-furnace injection technology. This segment offers its FUEL CHEM program for plants operating in the electric utility, industrial, pulp and paper, waste-to-energy, and university and district heating markets; and the owners of boilers, furnaces, and other combustion units. The company was incorporated in 1987 and is headquartered in Warrenville, Illinois.
How the Company Makes MoneyFuel Tech generates revenue primarily through the sale of its proprietary air pollution control technologies and fuel treatment chemicals. The company's key revenue streams include licensing fees for its technology solutions, sales of consumable products such as chemical additives, and service contracts for engineering and consulting services. Significant partnerships with utility operators and industrial clients contribute to its earnings, as these collaborations often lead to long-term contracts and recurring revenue from maintenance and support services. Additionally, Fuel Tech's ability to help clients achieve regulatory compliance and operational efficiencies provides a compelling value proposition that drives its sales and market presence.

Fuel Tech Earnings Call Summary

Earnings Call Date:May 12, 2025
(Q1-2025)
|
% Change Since: 90.63%|
Next Earnings Date:Aug 12, 2025
Earnings Call Sentiment Neutral
The earnings call presented a generally positive outlook for Fuel Tech, with significant growth in the FUEL CHEM segment and a strong financial position. However, challenges remain in the APC segment with a decline in revenue, and a net loss was reported for the quarter.
Q1-2025 Updates
Positive Updates
Record First Quarter for FUEL CHEM Segment
The FUEL CHEM business segment achieved its best first quarter performance in more than ten years, with revenues rising 92% compared to last year's first quarter.
Significant Revenue Growth
Revenues for the first quarter of 2025 rose 29% from the prior year period, driven by robust performance from the FUEL CHEM segment.
Increased Gross Margins and Reduced Operating Loss
Gross margins expanded, and the operating loss was narrowed significantly. Consolidated gross margin for the first quarter rose to 46% of revenues from 41% in last year's first quarter.
Strong Financial Position
The company maintained a strong financial position with cash, cash equivalents, and investments of approximately $31 million at quarter-end and no long-term debt.
Increase in APC Project Backlog
APC project backlog increased to the highest level in three years, with a 66% increase from December 31st, 2024.
DGI Technology Progress
A product demonstration for the Dissolved Gas Infusion (DGI) technology is set to commence, with discussions ongoing with potential customers in multiple end markets.
Negative Updates
Decline in APC Segment Revenue
APC segment revenue declined to $1.3 million from $2.3 million in last year's first quarter, primarily related to the timing of project execution on existing contracts.
Net Loss Reported
The company reported a net loss for the quarter of $739,000 or $0.02 per share, compared to net income of $281,000 or $0.01 per share in the same period one year ago.
Company Guidance
During the Fuel Tech 2025 First Quarter Financial Results Conference Call, the company provided positive guidance, reflecting strong performance and growth expectations. The FUEL CHEM business segment achieved a 92% revenue increase compared to the previous year, marking its best first quarter in over a decade. Consolidated revenues rose by 29% to $6.4 million, with the FUEL CHEM segment comprising nearly 80% of total revenues. Gross margins improved to 46% from 41% a year earlier. The company reported $5.6 million in bookings, and its APC project backlog reached the highest level in three years, with expectations to close an additional $3 to $5 million in new contract awards by the end of the second quarter. Fuel Tech maintained a strong financial position with approximately $31 million in cash and investments, and no long-term debt. For the full year 2025, the company expects total revenues to approximate $30 million, with both business segments surpassing 2024 performance levels.

Fuel Tech Financial Statement Overview

Summary
Fuel Tech is facing significant financial challenges with declining revenues and persistent profitability issues. While the balance sheet remains strong with low leverage, negative cash flows and ongoing losses indicate operational difficulties. Stability in gross margins offers some hope, but a strategic turnaround is essential for future growth.
Income Statement
45
Neutral
Fuel Tech has faced declining revenue over the years, with a recent drop from $27.1M in 2023 to $25.1M in 2024. The gross profit margin showed stability at around 42%, but the company has consistently reported negative EBIT and net income, indicating profitability challenges. The net profit margin was -7.7% in 2024, reflecting ongoing losses.
Balance Sheet
60
Neutral
The company maintains a strong equity position, with a high equity ratio of approximately 86%. However, the debt-to-equity ratio remains low at 0.01, indicating minimal leverage. Despite a solid asset base, the company has faced declining equity over the years.
Cash Flow
40
Negative
Fuel Tech's cash flow performance has been weak, with negative operating cash flow in 2024 at -$3.4M. The free cash flow has also been negative, dropping from $0.28M in 2023 to -$3.4M in 2024. The operating cash flow to net income ratio suggests cash generation issues relative to net income.
Breakdown
TTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
26.56M25.13M27.08M26.94M24.26M22.55M
Gross Profit
11.46M10.62M11.66M11.64M11.90M10.64M
EBIT
-3.96M-4.70M-2.66M-1.53M81.00K-4.14M
EBITDA
-3.10M-1.41M-1.11M-931.00K-748.00K-3.37M
Net Income Common Stockholders
-2.96M-1.94M-1.54M-1.44M54.00K-4.28M
Balance SheetCash, Cash Equivalents and Short-Term Investments
21.79M18.69M29.71M26.31M35.89M10.64M
Total Assets
46.71M48.80M50.39M50.12M49.97M30.09M
Total Debt
607.00K625.00K614.00K191.00K235.00K1.94M
Net Debt
-11.21M-7.88M-16.96M-23.14M-35.66M-8.70M
Total Liabilities
5.27M6.84M6.67M5.25M3.77M7.77M
Stockholders Equity
41.44M41.95M43.71M44.88M46.20M22.32M
Cash FlowFree Cash Flow
-1.11M-3.81M278.00K-4.34M677.00K-2.95M
Operating Cash Flow
-850.00K-3.43M696.00K-4.14M761.00K-2.71M
Investing Cash Flow
1.25M-5.44M-6.44M-9.48M-84.00K-247.00K
Financing Cash Flow
-119.00K-95.00K42.00K-17.00K23.98M1.28M

Fuel Tech Technical Analysis

Technical Analysis Sentiment
Positive
Last Price1.83
Price Trends
50DMA
1.26
Positive
100DMA
1.13
Positive
200DMA
1.08
Positive
Market Momentum
MACD
0.20
Negative
RSI
62.19
Neutral
STOCH
56.90
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FTEK, the sentiment is Positive. The current price of 1.83 is above the 20-day moving average (MA) of 1.70, above the 50-day MA of 1.26, and above the 200-day MA of 1.08, indicating a bullish trend. The MACD of 0.20 indicates Negative momentum. The RSI at 62.19 is Neutral, neither overbought nor oversold. The STOCH value of 56.90 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FTEK.

Fuel Tech Risk Analysis

Fuel Tech disclosed 20 risk factors in its most recent earnings report. Fuel Tech reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Fuel Tech Peers Comparison

Overall Rating
UnderperformOutperform
Sector (66)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
68
Neutral
$9.29M12.304.68%-14.25%-59.84%
66
Neutral
$4.47B12.225.40%3.65%4.14%-12.00%
55
Neutral
$31.46M-75.96%10.88%3.57%
54
Neutral
$58.17M-6.95%7.30%-247.48%
54
Neutral
$14.42M-69.66%-17.77%0.86%
51
Neutral
$22.22M-62.68%19.09%3.50%
39
Underperform
$52.11M-110.71%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
FTEK
Fuel Tech
1.83
0.77
72.64%
CLWT
Euro Tech Holdings Company
1.17
-0.58
-33.14%
CLIR
ClearSign Combustion
0.60
-0.11
-15.49%
LIQT
LiqTech International
1.50
-0.80
-34.78%
SCWO
374Water
0.36
-0.81
-69.23%
TOMZ
TOMI Environmental Solutions
1.08
0.06
5.88%

Fuel Tech Corporate Events

Business Operations and StrategyRegulatory Filings and Compliance
Fuel Tech Releases Updated Corporate Presentation
Neutral
May 22, 2025

Fuel Tech, Inc. announced that it will post an updated corporate presentation on its website, dated May 21, 2025. This presentation is part of a regulatory filing and is not subject to certain liabilities, indicating a strategic move to update stakeholders on the company’s current status and future plans.

The most recent analyst rating on (FTEK) stock is a Buy with a $4.00 price target. To see the full list of analyst forecasts on Fuel Tech stock, see the FTEK Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.