Pacific Crest’s Bachman Maintains SolarWorld at OUTPERFORM After Pre-Announcement
Source: http://feedproxy.google.com/~r/smallcappulse/feed/~3/sMJVqjU6ms0/Posted on Thursday, November 5th, 2009 | In Investing Lessons, Small & Micro Cap
November 5, 2009 ndash; Mark Bachman weighed in on SolarWorldrsquo;s (SWV.DE) pre-reported Q3 financial results, noting that both revenue and EBIT came in below expectations with revenue of euro;232.5 million, EBIT of euro;34.7 million and net income at euro;16 million. ASPs declined by about 12% in Q3, volumes increased by 15%and sales were up 3%.
Key Takeaways
middot;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp; SolarWorldrsquo;s stated revenue target of euro;1 billion for FY09 will require Q4 sequential growth to approach 60%, and channel checks into Germany suggest that may be difficult to achieve.
middot;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp; Modeling 2009 in line with managementrsquo;s target, but reduced gross and EBIT margin expectations given ASP concerns.
middot;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp; New price target is euro;18, which is 15x 2010 EPS estimate
middot;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp; Rates stock at OUTPERFORM
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