Constituent Review
|
J. Andrew Braswell, Equity Analyst
Newbridge Institutional Research
Data as of 3-30-07 |
|
 |
|
Nano
Materials |
Review
1/9/07- ALTI announced that it had received a $1.04M order for its NanoSafe™ 35 KWh battery pack systems from Phoenix Motorcars. These initial orders are scheduled for deliver in February and March, and are accompanied by a multi-year purchase agreement under which Phoenix has projected total orders for 2007 between $16M and $42M. In return for U.S. exclusivity for a three-year period, ALTI received 16.6% ownership in Phoenix. To retain these rights, Phoenix must meet minimum annual purchase requirements, starting at $16M in 2007.
2/6/07- Announced that it had formed a strategic alliance with UQM Technologies, whereby UQM’s electric motor, power generator and power electronics will be paired with ALTI’s NanoSafe™ battery packs.
2/28/07- Phoenix Motorcars announced that it had received a purchase order for four of its electric sport utility trucks, which utilize NanoSafe™ 35kWh battery packs supplied by ALTI. The trucks were ordered by Pacific Gas and Electric Company and are scheduled to be delivered in June.
3/5/07- Announced that global power concern AES Corporation has made a $3M equity investment in the company, representing a 1.5% ownership stake. A total of 895,523 shares were purchased by AES in a private transaction, for a per-share price of $3.35. ALTI agreed to register the shares for potential resale.
3/8/07- Reported Q4 results pre-open. Total revenue for the quarter was $2.0M with a net loss of $4.8M, or $0.08 per share. ALTI ended the period with $27.2M in cash.
3/9/07- Phoenix Motorcars announced that it had unveiled to guests in Texas its five-passenger, all-electric sport utility truck (SUT). The demonstration included nearly 200 guests and was held at the Sam Pack Automotive Museum. Phoenix says it has received orders for more than 200 SUTs from multiple municipalities and a utility, and that it is on track to manufacture and sell 500 units by year-end.
Commentary
Among the strongest performers in the NNIX for 2006 (+30%), ALTI was second-best in Q1 with a 17% gain. The company is clearly riding the wave of public enthusiasm toward alternative energy/cleantech with its regular updates of partner Phoenix’s electric vehicle progress. And it should be noted that the relationship has begun to positively impact ALTI’s results—of the $961K the company generated in product sales in 2006, $928K came in Q4 driven by billings of 11 battery packs. It is disclosed in the 10K, though, that only four of the 11 were shipped with the remainder held by ALTI at Phoenix’s request. Combined with relative financial instability of the partners, the notably wide range of Phoenix’s 2007 order forecast and ALTI’s history of over-hyping new product lines, we remain skeptical toward this situation. With the stock still trading at a lofty 50x T12 sales, it seems to us that market expectations have gotten far ahead of reality. |
