On Wednesday, TD Cowen adjusted its outlook on Westport Innovations (NASDAQ:WPRT), a leader in advanced combustion engine technology. The firm revised its price target downward to $7.50 from the previous target of $8.00, yet maintained a Hold rating on the company's stock. This adjustment reflects the firm's assessment of Westport's current business strategy and financial position.
Westport Innovations has been focusing on reducing costs throughout 2024 as it forms a joint venture with Volvo (OTC:VLVLY) and shifts towards utilizing its High Pressure Direct Injection (HPDI) technology in new sectors, including rail and marine.
"The company was able to raise ~$15mn over the last ~15 months to support its immediate operational needs, but we have longer-term liquidity concerns," said the analyst
Despite these concerns, the analyst noted that there has been a growing interest in the company's HPDI technology. This interest has not yet translated into a significant short-term revenue increase, but it suggests potential for the company's technology adoption in the market. The Hold rating suggests that TD Cowen advises investors to maintain their current position in Westport Innovations without increasing or decreasing their holdings significantly at this time.
InvestingPro Insights
As Westport Innovations (NASDAQ:WPRT) works on its cost reduction strategy and explores new market opportunities, real-time data from InvestingPro provides a snapshot of the company's financial health. With a market capitalization of $117.45 million and a negative P/E ratio reflecting its current lack of profitability, Westport's financial challenges are evident. The company's revenue growth over the last twelve months stands at 8.54%, pointing to modest business expansion despite the broader concerns.
InvestingPro Tips highlight that Westport is quickly burning through cash and analysts have revised their earnings expectations downwards for the upcoming period. However, the company has seen a significant return over the last week, with a 12.36% price total return, which may capture the attention of investors looking for short-term movements. Moreover, with liquid assets exceeding short-term obligations, Westport appears to have the immediate liquidity to manage its short-term financial commitments.
For investors seeking a deeper dive into Westport Innovations' financial metrics and strategic positioning, there are additional InvestingPro Tips available. These tips provide insights into the company's gross profit margins, stock price volatility, and the analysts' outlook on profitability. To explore these insights and more, consider using the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription at InvestingPro. There are 11 more tips available on InvestingPro that could guide investment decisions regarding Westport Innovations.
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