BOSTON (Thomson Financial) - Shares of Ultralife Batteries Inc. tumbled
Wednesday after the Newark, N.Y.-based battery maker was downgraded to hold from
buy at Collins Stewart LLC, which said 2008 is staged to be a blockbuster year
for the company, but increasingly wonders what Ultralife will do for an encore
in 2009.
The stock fell 14% to $17.75 on volume of 294,000 shares.
"Our 2009 revenue and earnings-per-share estimates are $269.6 million and
$1.15, respectively," Collins Stewart said. "But while 2008 has a substantial
degree of visibility, the outlook for 2009 is still uncertain. The large defense
orders over the past couple of months will be difficult to trump next year."
The firm also removed its $20-to-$22 price target range and said the order
book in Ultralife's defense business for 2008 is "robust enough" to offset
potential commercial declines. However, at current multiples, Collins Stewart
sees the potential upside as already priced in and believes 2008 to be a peak
year.
For 2007, Collins Stewart estimates earnings of 25 cents a share on revenue
of $142.3 million. Analysts surveyed by Thomson Financial, on average, estimate
earnings of 25 cents a share on revenue of $143.4 million.
Greg Saulnier
gs/jw
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