Advanced Energy Industries (AEIS) -9.2% premarket after yesterday's announcement that Garry Rogerson has decided to step down as CEO.
AEIS is downgraded to Hold from Buy at Needham following the news, as Rogerson is viewed as the key figure in driving the major operational changes to enable strong earnings growth and leverage; the firm is concerned that multiple high-level departures in such a short time could cause major disruption of the business.
Needham believes the solar sector will continue to improve due to technology approaching grid parity in several unsubsidized markets; increased availability of financing through a number of private funds and public vehicles; a more balanced supply/demand; and reducing cost structure.
The firm believes overall worldwide solar installation will grow from 36 GW in 2013 to 42 GW in 2014, driven by rising demand in China, the U.S. and several emerging markets, while demand out of the Europe and Japan will remain stable.
Shares of Advanced Energy Industries (AEIS +5.5%) spike after Raymond James initiated the stock at Outperform with a PT of $26 (potential upside of 34.6%).
Analyst Pavel Molchanov: "Having diversified away from its legacy thin film business, Advanced Energy emerged as one of the top global players in the PV inverter arena ... This provides direct leverage to the PV industry's secular growth curve ... this [is] the only solar stock we currently recommend."
Advanced Energy (AEIS -4.7%) is downgraded to Underperform from Neutral at BAML following a 33% YTD rally. While the firm continues to foresee improving semiconductor fundamentals and continued growth in inverters, the AEIS margin expansion story is well understood and fully reflected in the stock.
First Solar (FSLR +3.3%), SunPower (SPWR +3.4%), MEMC (WFR +2.7%), and Advanced Energy (AEIS +4.2%) open higher after Citi's Shahriar Pourreza (taking over from Timothy Arcuri, who left for Cowen) launches coverage with Buy ratings. While believing the solar panel market is becoming commoditized, Pourreza argues buying opportunities exist in companies with strong exposure to construction activity and growth markets. Trina (TSL) and Yingli (YGE) have been started at Hold, and Suntech (STP) at Sell.
The solar industry (TAN) may be ready to shine, as Citi analysts point to a potential rise in solar stocks given increased sell-though and production levels. The firm upgrades Yingli Green Energy and SunPower to Buy, and reiterates Buy ratings for Trina Solar, Advanced Energy Industries (AEIS) and MEMC Electronic. YGE +8.5%, SPWR +8.2%, TSL +6%, WFR +4.5% premarket.
Advanced Energy Industries (AEIS -4.7%) trades lower after its Q4 revenue came up shy of estimates due to greater than anticipated restructuring charges and weaker capital spending by some of its core customers. Thin film sales declined 29% Y/Y, primarily due to continued weak market conditions in solar panel and flat panel displays.
In the face of a challenging market for solar suppliers, Advanced Energy Industries (AEIS +3.3%) announces plans to restructure its manufacturing and R&D operations and cut jobs, primarily in its thin films business unit.
Advanced Energy Industries (AEIS) lowers its Q2 revenue outlook to $137-140M, vs. a previous forecast of $148-160M (May 2). AEIS blames the shift on a drop in solar panel pricing, and complex industry dynamics. AEIS -7% premarket. (PR)
Advanced Energy Industries Inc designs, manufactures, sells and supports industrial power conversion products that transform power into various usable forms. The Company also supplies thermal instrumentation products for advanced temperature control.