Although we don’t believe in timing the market or panicking over market movements, we do like to keep an eye on big changes — just in case they’re material to our investing thesis.
What: Shares of Canadian fuel cell company Ballard Power Systems Inc. (TSX: BLD)(Nasdaq: BLDP) plunged 10% today after its quarterly results and outlook disappointed Bay Street.
So what: The stock has soared over the past year on rapidly rising fuel-cell adoption, but today’s Q1 revenue miss — top-line increased 13% to $14 million vs. the consensus of $15.3 million — coupled with in-line guidance is forcing analysts to scale back their expectations a bit. While Ballard’s net loss narrowed to $3.8 million from $7.9 million in the year-ago period, it doesn’t seem to be improving fast enough in Mr. Market’s eyes to justify the recent price surge.
Now what: Management reaffirmed its full-year guidance for break-even adjusted EBITDA on revenue growth of about 30%. “Our Q1 results reflect continued improvement in key metrics, consistent with our business outlook and full-year guidance for 2014,” President and CEO John Sheridan said. “Also, after the quarter we were pleased to close a strategic transaction with United Technologies Corporation, giving Ballard a commanding industry position in fuel cell intellectual property and strengthening our ability to grow shareholder value.”
More important, with the stock now off about 55% from its 52-week highs, Mr. Market might finally be offering enterprising Fools a decent chance to buy into those growth prospects.