Tuesday, April 5, 2011

UPDATED: American Superconductor Warns, Stock Collapses (AMSC)

UPDATE: "American Superconductor: Après le déluge Analysts React (AMSC)"
Original post:
In late after-hours action the stock is down 42% at $14.44.
You may have wondered why we haven't posted on AMSC recently. I have had no clue what to make of the dichotomy between what the company was reporting and what the stock was saying. Discretion/valor and all that. Our last half-dozen posts are below the roundup, particular attenti0n should be paid to the Barron's piece.
Here are a few of the early takes on what's going on.
From MarketBeat:
American Superconductor Warns, Stock Plunges
Alternative energy plays are hot. Until they are not.

American Superconductor, a maker of technology for wind turbines and other so-called “smart grid” technologies such as surge protectors, said after the close that a key customer was refusing to take shipments of some of its components. As a result, American Superconductor slashed its current quarter and fiscal year outlook.

The shares plunged 44% in after-hours trading following the news.

In a press release, American Superconductor said Sinovel Wind Group “refused to accept contracted shipments of 1.5 megawatt and 3 megawatt wind turbine core electrical components and spare parts that AMSC was prepared to deliver."....MORE
From Reuters:
UPDATE 2-AMSC cuts FY outlook as top customer refuses shipments
* Sees FY rev less than $355 mln
* Says Sinovel refuses to accept contracted shipments
* Shares down 45 percent after market (Adds outlook, background, share movement)
April 5 (Reuters) - American Superconductor Corp cut its full-year outlook and said its biggest customer Sinovel Wind has refused to accept contracted shipments until the Chinese firm reduces inventory levels....MORE
From TheStreet:

Green Energy Losers: American Superconductor

Shares of American Superconductor(AMSC_) plunged in late trades Tuesday after the company said its primary revenue stream, Chinese wind power company Sinovel, has stopped taking shipments.

The Devens, Mass.-based company expects the loss of business from Sinovel to weigh heavily on both its fourth-quarter and full-year results, and investors responded accordingly in after-hours action. The stock was last quoted at $13.25, down 47%, on volume of nearly 800,000, according to Nasdaq.com.
Last December, Barron's ran a piece arguing that Sinovel's financial statements indicated an inventory glut and that American Superconductor's outlook couldn't be reconciled with the Sinovel numbers. The stock tanked after the Barron's report, but that decline was nothing compared with the action late Tuesday.

Greg Yurek, CEO at AMSC, had said in response to Barron's inquiries back in December, "It's growth, growth, growth. Our revenues are going to continue to grow, going forward. I don't see any slowdown."
On Tuesday after the close AMSC was sending a different message...MORE
From Tech Trader Daily:
AMSC Off 45% On FYQ4 Warning; We Told You So
Shares of Devens, Massachusetts-based American Superconductor (AMSC), which makes voltage-stabilization equipment and other devices useful in the energy grid, are down $11.26, or 45%, at $13.58 in late trading after having been halted, following a fiscal Q4 warning of revenue well below estimates....MORE

Our most recent posts, newest first:
Feb. 3, 2011  
Insider: Kevin Douglas Continues to Buy American Superconductor, Another $8 Million Last Month (AMSC)
Feb. 1, 2011
American Superconductor Beats, Raises (AMSC

...The stock is still trading below the $35.50 follow-on offering done last November.

Dec. 22, 2010 
How Much Money Does Kevin Douglas Have? (and why is he putting it all into American Superconductor?) AMSC
Dec. 12, 2010 
American Superconductor: "Flagging Winds From China" (AMSC)

From Barron's:
American Superconductor's recent rapid growth from wind turbines relies heavily on a single Chinese customer, whose inventories seem to be rising.
Dec. 3, 2010 
Co-Bookrunner on Recent Offering (Jeffries) Says Nice Things About American Superconductor (AMSC)

Deutsche, Morgan Stanley and Jefferies & Company, Inc. acted as lead book-running managers for the 4.6 million share offering priced at $35.50 on Nov. 10. Here's the book.
The stock has not traded above the offering price since then, here's the 1-month chart from BigCharts:

There were a slew of analyst changes in mid-March, here's a round-up via American Banking News, March 23, 2011:

Wunderlich analysts cut their price target on shares of American Superconductor Co. from $50.00 to $45.00. They now have a “buy” rating on the stock.
Needham & Company analysts downgraded shares of American Superconductor Co. from a “buy” rating to a “hold” rating.
Barclays Capital analysts cut their price target on shares of American Superconductor Co. from $30.00 to $25.00. They now have an “equal weight” rating on the stock.
Zacks Investment Research analysts reiterated a “neutral” rating on shares of American Superconductor Co.. They now have a $26.00 price target on the stock.
Jefferies analysts cut their EPS estimates on shares of American Superconductor Co.. They now have a “buy” rating and a $30.00 price target on the stock. They previously had a $41.00 price target on the stock.