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Stifel Nicolaus lowers its price target $2 to $48 on Buy-rated Polypore International
PPO as GM halts Volt production to adjust inventory levels.
Stifel Nicolaus notes, "We are lowering estimates for Polypore to account for General Motors' decision to idle production of the Chevy Volt plug-in-hybrid-electric-vehicle (PHEV) to curb rising inventories. Polypore recently guided down revenues for its lithium-ion separator division by ~$10mn sequentially in 1Q12, which we estimate $3.5mn-$4mn was the result of the NHTSA fire investigation that disrupted Volt production in January, 2012. While Friday's announcement calls for a 5-week shutdown, inventories suggest this issue could take 3-6 months to resolve unless there is a significant increase in monthly sell-through."
PPO closed at $39.78 a share on Friday.
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