A Big Upgrade for Advanced Battery Technologies

This bullish call comes from more than just one analyst.

Dave Mock
Dave Mock
Jul 9, 2010 at 12:00AM
Other

After spending much of the past year at a less-than-impressive two-star rank, Advanced Battery Technologies (Nasdaq: ABAT) has impressed enough top-performing members of our 165,000-strong Motley Fool CAPS community to climb all the way up to three stars. A total of 858 members have given their opinion on the battery technology firm, with many of them offering analysis and commentary explaining the recent optimism.

As Advanced Battery Technologies has expanded in recent years to offer not only a larger range of higher capacity batteries but also electric scooters through a purchase last year, some CAPS members believe the company is well-positioned for growth. With the electric-vehicle market gaining traction, investors like the possibility of more business coming Advanced Battery's way.                     

The company has been crowing about its success lately and reported an 83% jump in first-quarter revenue and an 85% increase in net income. The momentum seen in the electric-vehicle business led Advanced Battery to provide 2010 earnings guidance in the range of $32 million to $36 million, which is a big jump over the $21.4 million in earnings in 2009. Despite another quarterly loss for peer A123 Systems (Nasdaq: AONE), it, too, is seeing strong demand prompting it to increase capacity.                         

Electric vehicles have been gaining more attention lately with the recent IPO of Tesla Motors (Nasdaq: TSLA), which major auto manufacturer Toyota (NYSE: TM) sunk $50 million into via a post-IPO private placement. Companies like Johnson Controls (NYSE: JCI) and Magna International (NYSE: MGA) have been making big investments in electric-vehicle technology, with both companies working with Ford (NYSE: F) to make electric and plug-in vehicles a reality in coming years.

Advanced Battery Technologies itself is entering the U.S. electric-vehicle market with a recent order from All-Power America for electric motorcycles. With news like this and a debt-free balance sheet, investors are gaining confidence that the company can manage the current environment and potentially be successful with its growth plans.

Do you think Advanced Battery Technologies deserves its raised status? Add your thoughts in the comments box below on this page, or head over to CAPS to rate the company and check out all the information and opinions the community offers, absolutely free.