Cowen’s Stone Comments on SEIA Webinar and Maintains Evergreen Solar (Nasdaq:ESLR) at NEUTRAL
Source: http://feedproxy.google.com/~r/smallcappulse/feed/~3/U0JTMFx_Ym0/Posted on Friday, June 5th, 2009 | In Market Commentary, Small & Micro Cap
June 4 ndash; Analyst Comments ndash; Cowenrsquo;s Rob Stone weighed in this morning on a webinar yesterday held by the Solar Energy Industry Association (SEIA) providing updates on the DOE Loan Guarantee Program. He said he thinks the impact of the program will be material, but not until Q4 and after. The common consensus, which is also Stonersquo;s take, is that there are still challenges in terms of working through policies and a framework to roll out the program from a bureaucratic perspective. Stone also issued an update on Evergreen Solar (Nasdaq:ESLR) maintaining a NEUTRAL rating.
Key Takeaways on ESLR
middot;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp; Revising model to reflect increased shares and lower ASPs
middot;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp; Cutting 2009/10E revenue to $276 million and $440 million, reducing ASPs by 5-6% and sees ldquo;significantly lower gross margins (about 8% and 14%)
middot;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp; The increased shares will reduce the 2009E loss to $0.54, and cut 2010 loss to $0.09.
middot;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp; The companyrsquo;s ldquo;more electricity less impactrdquo; marketing campaign may be able to keep ESLR propped up at a 10-15% premium to its peers, but Stone noted that it will have to ultimately follow competitors down in pricing
middot;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp; Increased loss estimates for ESLRrsquo;s interest in Sovello JV
middot;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp;nbsp; Maintains Neutral rating and says that trading at about 0.7x book, sees little downside but still unfavorable risk/reward for stock
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