Six months ago, I thought that the hoopla over Maxwell Technologies' (NASDAQ:MXWL) prospects of securing an ultracapacitor order from Tesla (NASDAQ:TSLA)
(in addition to or along with other auto OEM orders) had taken the
shares a little too far for my comfort, and that it was better to wait
for a pullback. The shares proceeded to climb another 25% from that
point, but have been cut down by more than half on a guidance reset
following second-quarter numbers and the perception that management has
backed away from its guidance for multiple automotive design wins in
2014.
All in all, while the this sharp decline from the late May
highs has to be painful for Maxwell shareholders, the story has really
changed all that much. The company's ultracapacitors continue to look
like an interesting solution for a variety of applications in transport
and energy, while the company's manufacturing approach should support
attractive margins. Order timing is a major unknown, and these shares
are vulnerable to the vagaries of the market's appetite for risky
stories, but this seems like a good time for risk-tolerant investors to
take a closer look.
Continue here:
Maxwell Down On Power, But Still Promising
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