UPDATE: Axiom Capital Research Downgrades Power-One to Sell on Demand Challenges

Axiom Capital Research reduced its rating on Power-One

from Buy to Sell and lowered its price target from $6 to $3. Axiom Capital Research said, "While we expect PWER to exceed to the high-end of its C3Q12 rev guide of $260mn-$280mn owing to C3Q12 installs in Italy nearly tripling vs. C2Q12, we see a violent degradation in the company's fundamentals setting in as soon as C4Q12, proliferating in C1Q13 and through the rest of 2013 due to our work which suggests that 2013 Italian installations will fall nearly 80% vs. 2012. When also considering: (1.) demand in Germany has started to fall sharply since mid-Sept due to FiT cuts, (2.) our recent checks suggest there is now an oversupply of solar inverters in Europe, & (3.) popular pricing rag EnergyTrend showed an acute decline in inverter prices just this week, we expect PWER's C4Q12 guidance to reflect material risks." Power-One closed at $5.28 on Wednesday.