FuelCell Energy (FCEL) Surges 34.8% on Q4 Earnings Beat and Data Center Pivot

Summary
• FuelCell Energy (FCEL) surges 34.8% intraday, trading at $10.65 as of 17:54 ET
• Q4 2025 revenue hits $55.0M, up 12% YoY, with $1.19B backlog signaling growth
• CEO highlights data center focus, EXIM financing, and cost-cutting driving optimism

FuelCell Energy’s stock erupted 34.8% on December 18, 2025, fueled by a Q4 earnings beat and strategic pivot to data center markets. The company reported $55.0M in revenue, a 12% YoY increase, and a narrowed EBITDA loss of $18.5M. With a $1.19B backlog and $278.1M in unrestricted cash, management emphasized its readiness to capitalize on AI-driven energy demand. The stock’s intraday range of $9.25–$10.90 reflects sharp momentum.

Data Center Strategy and EBITDA Improvement Drive Rally
FuelCell Energy’s 34.8% surge stems from its Q4 2025 earnings report, which highlighted a 12% YoY revenue increase to $55.0M and a 43% improvement in EBITDA to -$18.5M. CEO Jason Few underscored the company’s focus on data center opportunities, citing absorption chilling integration and cost reductions. The $1.19B backlog, up 2.6% YoY, and $278.1M in unrestricted cash, bolstered by EXIM financing, signaled operational resilience. Investors interpreted these metrics as proof of the company’s ability to scale in high-growth markets.

Power Generation Sector Gains Momentum as FCEL Outpaces Peers
The Power Generation Equipment sector, led by Caterpillar (CAT) with a 0.89% intraday gain, saw mixed performance. While CAT’s modest rise reflected broader industrial stability, FCEL’s 34.8% surge underscored its unique positioning in data center energy solutions. Unlike traditional peers, FuelCell Energy’s carbonate fuel cell technology targets AI-driven power demands, offering a differentiated value proposition in a sector otherwise reliant on cyclical infrastructure spending.

Options and ETFs for Capitalizing on FCEL’s Volatility
• 200-day average: $6.016 (below current price)
• RSI: 69.09 (neutral to overbought)
• MACD: 0.2789 (bullish crossover)
• Bollinger Bands: $5.33–$9.52 (current price near upper band)

FuelCell Energy’s technicals suggest short-term overbought conditions but long-term bullish momentum. Key levels to watch include the 52-week high of $13.98 and the 200-day MA at $6.016. The stock’s 19.2% turnover rate and 19.2% turnover rate indicate strong liquidity. For leveraged exposure, consider ETFs like the Invesco Solar ETF (KWT), though no direct ETFs are listed for FCEL.

Top Options:
1. FCEL20251226C11 (Call, $11 strike, 12/26 expiry)
- IV: 108.64% (high volatility)
- LVR: 19.56% (high leverage)
- Delta: 0.4423 (moderate sensitivity)
- Theta: -0.0586 (rapid time decay)
- Gamma: 0.2190 (high sensitivity to price swings)
- Turnover: $13,036
- Payoff (5% upside): $0.58/share
- This contract offers aggressive upside potential with high gamma and leverage, ideal for short-term bullish bets.
2. FCEL20260102C11 (Call, $11 strike, 1/2/26 expiry)
- IV: 107.30% (high volatility)
- LVR: 13.72% (moderate leverage)
- Delta: 0.4764 (moderate sensitivity)
- Theta: -0.0406 (moderate time decay)
- Gamma: 0.1678 (moderate sensitivity)
- Turnover: $23,643
- Payoff (5% upside): $0.58/share
- This longer-dated option balances leverage and time decay, suitable for holding through potential catalysts in early 2026.

Action: Aggressive bulls may consider FCEL20251226C11 for a 5% upside target, while FCEL20260102C11 offers a safer, time-extended play.

Backtest Fuelcell Energy Stock Performance
The backtest of FCEL's performance after a 35% intraday surge from 2022 to the present reveals mixed results. While the stock experienced a maximum return of 35% on the day of the surge, the overall short-term and medium-term performance was lackluster. The 3-day win rate was 41.60%, the 10-day win rate was 43.11%, and the 30-day win rate was 40.35%, indicating a higher probability of positive returns in the immediate aftermath of the surge. However, the average returns over these periods were negative, with a 3-day return of -0.84%, a 10-day return of -1.40%, and a 30-day return of -4.14%. This suggests that while the stock had a strong day of performance, it largely gave up those gains in the following days, making the overall strategy challenging in terms of capturing and holding onto the gains from such a significant intraday surge.

FCEL’s Data Center Bet: A High-Volatility Trade with Clear Catalysts
FuelCell Energy’s 34.8% rally reflects investor confidence in its data center strategy and improved EBITDA. While the stock remains unprofitable, its $1.19B backlog and EXIM financing provide a runway for growth. Key risks include execution on the $167.4M Hartford Project and competition in the data center energy space. Watch for a breakout above $13.98 (52-week high) or a breakdown below the 200-day MA at $6.016. For context, Caterpillar (CAT) rose 0.89%, highlighting the sector’s broader strength. Action: Target a 5% upside with FCEL20251226C11 or hold FCEL20260102C11 for early 2026 catalysts.