Despite reduced revenues, Robertson Stephens rates IMPCO Buy
IMPCO Technologies, Inc. (Nasdaq: IMCO) $17.25 Buy F2001E EPS: ($1.19), down from ($0.63) F2002E EPS: ($1.17), down from ($0.42)
"IMPCO reported its Q3:FY01 results with EPS of ($0.42) on total revenue of $22.0 million versus our EPS estimate of ($0.22) and revenue estimate of $25.3 million, respectively," said Callahan. "The shortfall was primarily attributable to a continued strong dollar (especially versus the Euro and Australian dollar), weakness in aftermarket motor vehicle conversion sales in the key Mexican market, and a significant slowdown in small engine sales (due to a post-Y2K inventory correction.) We are maintaining our Buy rating on shares of IMPCO Technologies. Despite missing our estimates, we believe IMPCO is showing improvements, as the company continues to make positive announcements with, we believe, many in the pipeline such as further opportunities in the UK and India. We believe this underperformance was somewhat imbedded into the stock as the stock has taking a significant decline over the last couple of weeks. In addition, we believe investors buying shares of IMPCO Technologies get an existing commercial business, with a 40- year track record, along with the potential upside from one of the developmental leaders in advanced enabling technologies for fuel cells, which, in our view, represents an impressive risk/reward scenario within the energy technology sector."
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