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Why American Superconductor Stock Popped Today

By Rich Smith - Jun 4, 2021 at 11:11AM

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American Super beat on sales last quarter -- and might do it again this quarter.

What happened

Shares of American Superconductor (AMSC 5.20%) bounced back from a 15.5% post-earnings plunge yesterday to rise 11% as of 10:22 a.m. EDT Friday.

So what

In its fiscal fourth-quarter and full-year 2020 earnings report, released Wednesday evening, the specialist in "megawatt-scale power resiliency solutions" for electric grids had exceeded expectations for sales, reporting $21.2 million in revenue for its final quarter of the fiscal year. Nevertheless, the company lost $0.29 per share ($0.21 pro forma), only matching analyst expectations.  

For the full year, American Superconductor said revenue totaled $87.1 million, up 36.5% year over year, and net losses were $0.95 per share, 8% less than the $1.03 lost in fiscal year 2019.

Worker with a laptop examines an electric tower and power lines

Image source: Getty Images.

Now what

American Superconductor's only mixed results and continued losses seemed to disappoint investors yesterday, the first day they were able to trade on Wednesday's news. Today, however, investors may be turning their focus to the company's forecast for the first quarter of 2021 and beyond.

In fiscal Q1 2021, currently under way, management said revenue will range from $22 million to $26 million. At the midpoint -- $24 million -- that implies a much better result than the $20.2 million in sales analysts had been forecasting. Management still thinks it will lose money in Q1 ($0.24 per share, or $0.17 pro forma) and with cash flowing negative to boot. Nevertheless, the better-than-expected sales number, combined with hopes that American Superconductor will benefit as an "infrastructure play" under the Biden administration's new infrastructure plan, seems to be reviving enthusiasm for the stock today.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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