American Superconductor shares drop after guidance

Shares of American Superconductor Corp. fell Wednesday, the day after the energy equipment supplier said its third-quarter loss will likely be wider than Wall Street expects.

The stock fell 79 cents, or 4.6 percent, to $16.40. Shares have traded between $8.22 and $47.53 in the past 52 weeks.

The Devens, Mass., company said its fiscal third-quarter loss likely will fall in the range of 18 cents to 21 cents per share. That's well below the 11 cent-per-share loss analysts polled by Thomson Reuters expect, on average.

American Superconductor previously said it expected a third-quarter loss to be slightly wider than its loss for the second quarter of $4.1 million, or 10 cents per share.

The company blamed the projected loss on cost overruns on a utility grid project, deferred revenue due to higher engineering costs on wind turbine design contracts, and excess inventory charges at a subcontractor.

"While disappointing, none of these issues speak to any fundamental change in the demand for American Superconductor's core products," Citi Investment Research analyst Timothy M. Arcuri said in a note to clients.

Arcuri kept a "Hold" rating and $15 price target on the company, implying he expects the stock to slide about 13 percent from Tuesday's $17.19 close.

"Profitability remains a question, making valuation beyond the $15 range on a sum-of-the-parts basis tough to justify," he said.

Final results from American Superconductor are due Feb. 3.