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1. Company Snapshot

1.a. Company Description

Fuel 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.

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1.b. Last Insights on FTEK

Fuel Tech, Inc.'s recent performance has been positively driven by several factors. The company reported Q2 results, beating loss estimates with a quarterly loss of $0.02 per share. Additionally, it received air pollution control orders totaling $3.2 million from new and existing customers. The company's President & CEO is set to present at the H.C. Wainwright 27th Annual Global Investment Conference, providing an opportunity for investor engagement. These developments have contributed to a favorable outlook. (Source: Company press releases and earnings reports)

1.c. Company Highlights

2. Fuel Tech's Q3 2025 Earnings: A Strong Performance Amidst Mixed Segment Results

Fuel Tech reported a slight decline in consolidated revenues to $7.5 million from $7.9 million in the prior year period, primarily due to lower APC segment revenues, partially offset by higher FUEL CHEM segment revenue. However, the company achieved a notable improvement in consolidated gross margin, which rose to 49% of revenues from 43% in last year's third quarter. Earnings per share (EPS) came in at $0.01, in line with estimates. The company's cash and investments stood at nearly $34 million at quarter-end, with no long-term debt, underscoring its strong financial position.

Publication Date: Nov -24

📋 Highlights
  • Profitable Operations & Strong Cash Position: Maintained profitability with $34M cash and investments, no long-term debt.
  • FUEL CHEM Revenue Growth: New client added in mid-2024 contributing $2.5M–$3M annual revenue potential.
  • APC Backlog Expansion: Backlog reached $9.5M, with $7.1M expected to convert in next 12 months.
  • 2025 Revenue Guidance: Projects $27M revenue (+8% YoY) despite Q3 revenue dip to $7.5M from $7.9M.
  • Data Center Pipeline Growth: Added $80M–$100M in data center opportunities, boosting total pipeline to $150M–$200M.

Segment Performance and Outlook

The FUEL CHEM segment drove growth, with increased dispatch at legacy clients and contributions from a new account added in mid-2024. The APC business segment backlog increased to $9.5 million, with expectations to recognize approximately $7.1 million of the current consolidated backlog in the next 12 months. Fuel Tech is confident in its ability to maintain a strong financial position to fund its short- and long-term growth initiatives across its business segments. As Vince Arnone, CEO, mentioned, "We'll see near-term benefits from our aftermarket business, but our goal is to capitalize on the intellectual property (IP) to pursue larger capital project awards in 2026 and beyond."

Growth Prospects and Pipeline

Fuel Tech is pursuing additional new awards driven by industrial expansion globally and state-specific regulatory requirements in the U.S. The company expects revenues for 2025 to be approximately $27 million, representing an 8% increase over 2024. Analysts estimate next year's revenue growth at 21.4%, indicating a positive outlook. The global sales pipeline has expanded, with data center opportunities now totaling $80 million to $100 million, in addition to a standard APC business pipeline of $10 million to $20 million.

Valuation and Metrics

With a P/E Ratio of -17.67 and an EV/EBITDA of -13.62, the market is pricing in significant growth expectations. The P/S Ratio stands at 2.15, indicating a relatively reasonable valuation considering the revenue growth prospects. The company's ROE and ROIC are negative, at -7.29% and -10.59%, respectively, which may raise concerns about profitability. However, the Free Cash Flow Yield is 5.41%, suggesting a potentially attractive return for investors.

3. NewsRoom

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4 Pollution Control Stocks to Watch on Robust Industry Trends

Nov -14

Source: zacks.com

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Nasdaq 100 Forecast: AMD and Nvidia Fuel Tech Comeback in US Stock Market

Nov -12

Source: fxempire.com

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Fuel Tech, Inc. (FTEK) Q3 2025 Earnings Call Transcript

Nov -05

Source: seekingalpha.com

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Fuel Tech, Inc. (FTEK) Q3 Earnings Meet Estimates

Nov -05

Source: zacks.com

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Fuel Tech Schedules 2025 Third Quarter Financial Results and Conference Call

Oct -23

Source: globenewswire.com

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IP Group: OXCCU raises £20m to advance sustainable aviation fuel tech

Sep -29

Source: proactiveinvestors.co.uk

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Fuel Tech to Present at H.C. Wainwright 27th Annual Global Investment Conference

Sep -04

Source: globenewswire.com

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4 Pollution Control Stocks to Watch on Robust Industry Trends

Aug -20

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.97%)

6. Segments

FUEL CHEM

Expected Growth: 4.83%

Fuel Chem's 4.83% growth is driven by increasing adoption of pollution control technologies, stringent environmental regulations, and rising demand for clean energy solutions. Additionally, Fuel Tech's proprietary technologies and strategic partnerships have enabled the company to capitalize on the growing need for fuel efficiency and emissions reduction in the industrial sector.

Air Pollution Control

Expected Growth: 9.27%

Fuel Tech's Air Pollution Control segment growth of 9.27% is driven by increasing environmental regulations, rising demand for clean energy, and growing adoption of pollution control technologies in the power and industrial sectors. Additionally, the company's innovative solutions and strategic partnerships have contributed to its market share expansion.

7. Detailed Products

DERF

Dissolved Elemental Removal Facility, a patented technology that removes impurities from fuel, improving combustion efficiency and reducing emissions.

Aquafining

A patented water-based process that removes impurities from fuel, improving fuel quality and reducing emissions.

Fuel Chem

A line of fuel additives and chemicals that improve fuel efficiency, reduce emissions, and enhance fuel quality.

FuelSpec

A patented fuel analysis technology that provides real-time fuel quality monitoring and analysis.

8. Fuel Tech, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Fuel Tech, Inc. faces moderate threat from substitutes due to the availability of alternative fuel sources and technologies.

Bargaining Power Of Customers

Fuel Tech, Inc. has a diverse customer base, which reduces the bargaining power of individual customers.

Bargaining Power Of Suppliers

Fuel Tech, Inc. relies on a limited number of suppliers for critical components, giving them significant bargaining power.

Threat Of New Entrants

Fuel Tech, Inc. operates in a capital-intensive industry with high barriers to entry, making it difficult for new entrants to join the market.

Intensity Of Rivalry

Fuel Tech, Inc. operates in a highly competitive industry with several established players, leading to intense rivalry among competitors.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 0.36%
Debt Cost 3.95%
Equity Weight 99.64%
Equity Cost 24.97%
WACC 24.90%
Leverage 0.36%

11. Quality Control: Fuel Tech, Inc. passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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CECO Environmental

A-Score: 4.5/10

Value: 2.0

Growth: 6.0

Quality: 6.6

Yield: 0.0

Momentum: 9.5

Volatility: 3.0

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BrightView

A-Score: 4.3/10

Value: 6.1

Growth: 5.6

Quality: 5.1

Yield: 0.0

Momentum: 3.0

Volatility: 6.0

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Energy Recovery

A-Score: 4.3/10

Value: 1.4

Growth: 7.6

Quality: 8.2

Yield: 0.0

Momentum: 3.0

Volatility: 5.3

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TOMI Environmental Solutions

A-Score: 4.1/10

Value: 6.8

Growth: 3.3

Quality: 3.6

Yield: 0.0

Momentum: 9.0

Volatility: 1.7

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Fuel Tech

A-Score: 3.8/10

Value: 5.6

Growth: 2.4

Quality: 3.5

Yield: 0.0

Momentum: 9.5

Volatility: 2.0

1-Year Total Return ->

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ClearSign Technologies

A-Score: 3.8/10

Value: 6.4

Growth: 7.4

Quality: 3.7

Yield: 0.0

Momentum: 4.0

Volatility: 1.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

1.69$

Current Price

1.69$

Potential

-0.00%

Expected Cash-Flows