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Energy storage and power delivery products maker, Maxwell Technologies Inc. (MXWL - Analyst Report) reported first quarter 2011 adjusted earnings of 1 cent per share, missing the Zacks Consensus Estimate of 5 cents. However results comfortably beat the year-ago quarterly loss per share of 5 cents.

Operational Performance

Maxwell Technologies’ top line in the first quarter improved 32.7% from the year-ago quarter, reporting revenue of $35.3 million. Revenues in the quarter were in line with the Zacks Consensus Estimate of $35 million.

BOOSTCAP Ultracapacitor revenue was $21.4 million, up 55% from $13.8 million for the same period last year. Revenue growth for ultracapacitor was primarily driven by energy storage solutions for wind turbine blade pitch systems and hybrid and electric transit vehicle drive systems.

Further, increasing contributions from automotive stop-start idle elimination systems and various backup power applications also helped the ultracapacitor sales.

Revenue from high voltage capacitor and microelectronics products was $13.9 million, up 8% from the year-ago quarter.

Driven by this strong top line growth and ongoing cost reduction and efficiency improvements, the company posted improved operating results compared to last year. Net income for the first quarter 2011 was $0.2 million compared with a net loss of $1.2 million in the year-ago quarter.

Financial Condition

Maxwell Technologies’ reported cash and cash equivalents of $33.1 million compared to $39.8 million at fiscal-end 2010. Long-term debt decreased to $2.3 million in the reported quarter from $12.6 million at fiscal-end 2010.

Outlook

Maxwell Technologies is a leading manufacturer of ultracapacitors, high-voltage capacitors and microelectronics products. The company displayed consistent growth in its quarterly top line in the recent past.

Looking ahead, the strong demand for the company’s products related to the utility infrastructure, renewable energy, public transportation, and space programs seems to be constant. Also its key end-markets appear to benefit from government stimulus programs as well as more stringent automotive emissions legislation.

However, downside risks include the rate of penetration for ultracapacitor technology into broader markets, a higher cost structure for ultracapacitor production, R&D overheads and earnings dilutive equity issuances.

Maxwell Technologies presently retains a short-term Zacks #3 Rank (Hold), which supports our long-term Neutral recommendation on the stock. In the near-term we would advise investors to focus on the Zacks #2 Rank (short-term Buy rating) peers like AVX Corp. (AVX - Snapshot Report) and OSI Systems Inc. (OSIS - Snapshot Report).

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