Maxwell Beats Revenue, Lags EPS

Energy storage and power delivery products maker, Maxwell Technologies Inc. (MXWL - Analyst Report) reported third quarter 2011 adjusted earnings of 2 cents per share, falling short of the Zacks Consensus Estimate of 4 cents. Results however, came above the year-ago quarterly earnings of a penny.

On a reported basis the company reported earnings of a penny in the reported quarter versus a loss of 9 cents in the year-ago quarter.

Operational Performance

Maxwell Technologies’ revenue was $41.1 million in the third quarter 2011, up 30.7% from $31.5 million in the year-ago quarter, and marginally beating the Zacks Consensus Estimate of $41.0 million. Ultracapacitor revenue was $24.9 million, up 34% year over year. Revenue from high voltage capacitor and microelectronics products was $16.2 million, up 26% from the year-ago quarter. The quarter witnessed strong demand for ultracapacitor products across multiple applications, including stop-start idle elimination systems in micro hybrid autos, backup power, wind turbines, and transit vehicle drive systems.

In the reported quarter, Maxwell Technologies clocked operating income of $1.2 million, compared with an operating loss of $0.9 million in the year-ago period. Overall, the company recorded net income of $0.3 million compared with a net loss of $2.4 million in the year-ago period.

Financial Condition

Maxwell Technologies reported cash and cash equivalents of $31.0 million compared with $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.

Background

Maxwell Technologies is a leading manufacturer of ultracapacitors, high-voltage capacitors and microelectronics products. Looking ahead, the company’s products are sure to experience strong demand growth related to the utility infrastructure, renewable energy, public transportation, and space programs. Particularly the company’s key end markets appear likely to benefit from government stimulus programs as well as more stringent automotive emissions legislation.

Outlook

Maxwell Technologies expects sequential top-line growth in the range of 3%–5% in the fourth quarter of 2011.

We presently retain a short-term Zacks #3 Rank (Hold) and a longer-term Neutral recommendation on the stock. In the near term we would advise investors to focus on its Zacks #1 Rank (short-term Strong Buy rating) peers like CalAmp Corporation (CAMP - Snapshot Report) and ZAGG Incorporated (ZAGG - Snapshot Report).

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