Shares of A123 Systems Inc. (NASDAQ: AONE) rose more than 50% yesterday on the company’s announcement of a new battery technology. While there is substantial promise in the new technology, which A123 calls Nanophosphate EXT, at least one analyst is not impressed and his opinion is cutting into yesterday’s gains.
Wunderlich Securities’ analyst Theodore O’Neill has called new battery technologies “a dime a dozen” and points out that even if A123’s technology is as good as the company claims, it will not solve the company’s immediate problems because it often takes years to develop new technology and to get it into mass production:
Years are not what A123 has. Indeed, according to our analysis it will need $400 million more than it’s got to make it through the next 18 months, and even then it would not be enough. We reiterate our ‘Sell’ rating and our 50-cent price target, which would be zero except that we believe the factory has some residual scrap value.
That’s harsh. But remember that the new technology announcement followed by just two weeks A123’s “going concern” letter.
Shares in A123 are down about -15% at about noon today, at $1.36 in a 52-week range of $0.82-$5.91.
Paul Ausick
Want to Retire Early? Start Here (Sponsor)
Want retirement to come a few years earlier than you’d planned? Or are you ready to retire now, but want an extra set of eyes on your finances?
Now you can speak with up to 3 financial experts in your area for FREE. By simply clicking here you can begin to match with financial professionals who can help you build your plan to retire early. And the best part? The first conversation with them is free.
Click here to match with up to 3 financial pros who would be excited to help you make financial decisions.
Have questions about retirement or personal finance? Email us at [email protected]!
By emailing your questions to 24/7 Wall St., you agree to have them published anonymously on a673b.bigscoots-temp.com.
By submitting your story, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
