Echelon Initiated with a $10+ Target
Echelon (ELON - Snapshot Report) designs, markets and sells system and network infrastructure products such as air conditioners, appliances, electricity meters, light switches, thermostats and valves for the smart grid and the network control markets. The company designs and supports systems and software that allow open and integrated control networks to connect machines and other electronic devices for the purpose of sensing, monitoring and controlling automatic doors, lighting, security systems, rail networks and many more.
The company is currently trading at its 52-week low price. After posting a strong revenue growth in 2007, Echelon provided very disappointing guidance for fiscal 2008, and blamed much of the shortfall on slow ramp of its NES [Network Energy Services] projects and delay in bookings. We believe slow bookings are likely to hamper growth in 2008.
Moreover, the stock has fallen significantly this year given its poor guidance, which will further hinder its top-line as well as bottom line over the next two years. We therefore believe that the stock should trade at a discount to its peer group.
We are initiating coverage on Echelon shares with a Hold recommendation and $10.50 target price. This represents a P/S [price-to-sales] multiple of approximately 2.8x, our fiscal year 2008 revenue per share estimate of $3.59, a discount to its peer group.
Read the full analyst report on ELON
|
|
|
Share |
RSS |
Rate Pos |
Rate Neg |
Comment |
|
|
||||||
Loading Stories...Most Popular on Zacks.com
More Zacks Resources
Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.
Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.
Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.
My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.
More Zacks Links
| Market Summary | Nov 08, 2009 13:49 pm ET |
Sponsored Links

Sponsored Links 
-0.76 %

17.46
[CLICK TO CLOSE X]