In a report released today, Colin Rusch from Oppenheimer upgraded Capstone Turbine Corp (NASDAQ: CPST) to Buy, with a price target of $2. The company’s shares closed yesterday at $0.70, close to its 52-week low of $0.58.
Rusch observed:
“We are upgrading CPST to Outperform from Perform on two premises. First, the company has effectively rationalized its overhead while working through a difficult period for demand. At the same time, with revenue approaching $100M annually, CPST shares are trading at an enterprise value of $24M including $10M in net cash. As we adjust estimates modestly lower, we believe both sales and GM have bottomed and the company is actively managing cash effectively. We anticipate order activity to pick up and estimate the company will reach EBITDA break-even in FY19 as that order activity translates into sales growth.”