The Motley Fool

Why Shares In AFC Energy plc Spiked Today

Although we don’t believe in timing the market or panicking over every stock fluctuation, understanding how a business is performing, competing and changing is vital to sensible investment.

SONY DSCWhat: AFC Energy (LSE: AFC), the industrial fuel cell specialist, has signed a heads of agreement with Daniel Inc., a South Korean power plant owner, for a 1MW fuel cell system. Shares of AFC energy were up 10% in early trade.

So what: This marks the second major advance by AFC Energy in South Korea — a key target market — in the space of a single week. Under the terms of the latest deal, a deposit of £1.25m will be payable to AFC Energy upon the signing of a formal contract and supply agreement. The contract will also include a follow-on option for a further 3MW system at a second site, depending on performance, which could eventually lead to sales of $15m. 

Now what: South Korea has a clean energy incentive programme with a goal of becoming one of the world’s largest producers of renewable energy. AFC Energy’s chief executive, Ian Williamson, said that he expects “many more orders to come” from the country.

But after falling by 35% this year, is AFC Energy set to be outperformed by "The Motley Fool's Top Growth Stock" in the second-half of 2014?

We believe this hidden gem could double profits within four years. For your FREE copy of our detailed investment report simply click here.

Mark Stones has no position in any shares mentioned. The Motley Fool has no position in any of the shares mentioned.