Jennings Capital Downgrades Ballard Power Systems

Jennings Capital downgraded Ballard Power Systems Inc. BLDP in a report issued Thursday from Buy to Hold and lowered its price target from $5 to $3.

Analyst Dev Bhangui noted that the company “reported Q3/14 results that were below our and consensus estimates. EPS were ($0.02) versus JCI and consensus of ($0.01). Revenue and gross margin missed our expectations, while opex came in slightly better.”

“The GM miss was related to product mix, as we had expected greater revenue contribution from Back-up Power. While Adjusted EBITDA turned positive in Q3; in light of the revenue miss, BLDP cut its FY2014 revenue guidance to a 20 percent increase over 2013, down from previous guidance for 30 percent growth,” according to Bhangui.

The report concluded that “BLDP’s long-term prospects remain favorable. However, with management having missed its own Q3 expectations, we remain cautions on Q4.”

Bhangui took a “‘wait-and-see’ approach”...and “will revisit [his] valuation with the release of FY2015 guidance in Q1.”

Ballard Power Systems Inc. recently traded at $2.84, up 2.16 percent.