Akeena Solar Inc. (NASDAQ: AKNS)
Akeena Solar Inc. (AKNS) is a designer, integrator and installer of solar power systems. The Company markets, sells, designs and installs systems for residential and commercial customers, sourcing components (such as solar panels and inverters) from manufacturers such as Suntech, Kyocera Fronius and SMA. The Company is active in the solar power industry as a designer and installer. The Company serves customers in California, New York, New Jersey, Pennsylvania and Connecticut. AKNS has a strategic partnership with Enphase Energy Inc. to develop and market Andalay solar panel systems with ordinary AC house current output instead of high voltage DC output.
The Company was founded in 2001 and is headquartered in Los Gatos, California, with additional offices in Fresno, Lake Forest, Santa Rosa, Palm Springs, San Diego and Thousand Oaks, California; Denver, Colorado; and Milford, Connecticut.
|
Share Statistics (10-Dec-09) |
|
FY 2007 |
FY 2008 |
% Chg |
Q3 2008 |
Q3 2009 |
% Chg |
|
| Symbol |
AKNS |
Revenue, $Mn |
32.2M |
40.8M |
21.1% |
n/a |
7.7M |
n/a |
| Current price |
$1.76 |
Gross marg. |
21.2% |
14.6% |
31.1% |
n/a |
24.7% |
n/a |
| 52wk Range: |
$0.58-2.61 |
Oper. margin |
-34.4% |
-59.7% |
42.4% |
n/a |
-41.6% |
n/a |
| Avg Vol (3m): |
186,678 |
Net margin |
-34.2% |
-59.6% |
42.6% |
n/a |
-31.2% |
n/a |
| Market Cap. |
62.6M |
|
|
|
|
|
|
|
| Dil. Shares Outst. |
35.6M |
EPS, $ |
-0.52 |
-0.77 |
32.5% |
n/a |
-0.07 |
n/a |
Source: Reuters.com, SEC Filings.
Financial Summary
Net sales for the third quarter of 2009 were $7.7 million compared to $10.6 million in net sales in the third quarter of 2008, and $5.9 million in the second quarter of 2009. The decline in the third quarter compared to the same quarter last year reflects a decline in commercial revenue due to the tight credit market and overall economic conditions. The increase from the second quarter reflects a higher level of residential sales. Residential installations were $6.8 million in both the third quarter of 2009 and the third quarter of last year and $4.7 million in the second quarter of 2009. Commercial sales were $484,000 in the third quarter of 2009 compared to $3.1 million in the third quarter of 2008, and $665,000 in the second quarter. Net sales for the first nine months of 2009 were $21.2 million, compared to $29.9 million in the same period last year reflecting a decline in commercial revenue of $9.5 million and the absence of East Coast and Colorado residential installations.
Gross profit for the third quarter of 2009 was $1.9 million, or 24.7% of sales, compared to $1.3 million, or 12.7% of sales, in the third quarter of 2008 and $1.2 million, or 19.7% of sales, in the second quarter of 2009. The increase in gross margin compared to the third quarter last year reflects primarily lower panel prices in the third quarter and lower direct labor costs due to efficiencies gained with Andalay panels, offset somewhat by lower average system prices. The increase in gross margin compared to the second quarter of 2009 reflects lower panel prices and higher subcontractor costs in the second quarter associated with the Company’s exit from the Colorado direct installation business. For the first nine months of 2009, gross profit was $5.3 million, compared to $4.8 million for the same period last year; gross profit margin for the first nine months of 2009 was 25.1% compared to 16.1% last year, primarily due to lower panel prices and lower direct labor costs, offset somewhat by lower average system prices.
Total operating expenses for the third quarter of 2009 were $5.1 million compared to $6.8 million for the same period last year, and $4.3 million in the second quarter of 2009. Compared to the third quarter of 2008, the $1.7 million reduction consisted of lower sales and marketing expenses of $874,000 and lower general and administrative costs of $878,000, reflecting the full impact of cost cuts made in the fourth quarter of 2008 and the first quarter of 2009. Stock-based compensation expense was $862,000 in the third quarter of 2009 compared to $1.1 million for the same period last year and $458,000 in the second quarter. Cash operating expenses (adjusted for stock-based compensation expense and depreciation and amortization expense) were $4.0 million in the third quarter of 2009 compared to $5.6 million for the same period last year and $3.7 million in the second quarter of 2009. Total operating expenses for the first nine months of 2009 were $15.1 million compared to $20.1 million in the first nine months of 2008.
The number of employees at quarter end was 137 full time equivalents, an increase from 125 at the end of the second quarter of 2009 and a decrease of 71 from 208 at September 30, 2008.
Net loss for the third quarter of 2009 was $2.4 million, or $0.07 per share, compared to a net loss of $5.5 million, or $0.19 per share, in the third quarter of 2008, and a net loss of $4.7 million, or $0.14 per share, in the second quarter of 2009. The third quarter net loss includes a favorable $758,000 non-cash adjustment to reflect the fair value of common stock warrants accounted for as a liability in accordance with provisions of the warrant agreements. Excluding the adjustment to the fair value of warrants, net loss for the third quarter of 2009 was $3.2 million, or $0.09 per share, an improvement of $0.10 per share compared to the third quarter of 2008 due to operating expense reductions of $1.8 million and the increased gross profit.
Net loss for the first nine months of 2009 was $12.2 million, or $0.39 per share, compared to net loss of $15.2 million, or $0.54 per share, for the same period last year. The non-cash adjustment to the fair value of common stock warrants for the first nine months of 2009 was $2.3 million. Excluding the adjustment to the fair value of warrants, net loss for the first nine months of 2009 was $9.8 million, or $0.31 per share, an improvement of $5.3 million or $0.23 per share compared to the same period last year, due to operating expense reductions of $5.5 million.
Installations for the quarter amounted to approximately 1,027 kilowatts compared to approximately 1,290 kilowatts in the same quarter last year and approximately 716 kilowatts in the second quarter of 2009. Backlog as of September 30, 2009, was $8.3 million reflecting primarily California residential sales.
Cash and cash equivalents at September 30, 2009, were $7.2 million. The $1.0 million cash-backed line had no balance drawn as of quarter end.
| Financial Strength (10-Dec-2009) | Company | Industry | Sector | S&P 500 |
| Quick Ratio (MRQ) | 1.50 | 0.93 | 0.94 | 0.90 |
| Current Ratio (MRQ) | 1.94 | 1.01 | 1.03 | 1.06 |
| Long-Term Debt to Equity (MRQ) | 4.38 | 137.21 | 131.89 | 125.63 |
| Total Debt to Equity (MRQ) | 6.92 | 161.67 | 155.52 | 192.52 |
Source: Reuters.com, SEC Filings.
Analyst Consensus
|
Buy |
Outperform |
Hold |
Underperform |
Sell |
No Opinion |
This is the consensus forecast amongst 4 polled investment analysts. Against the Akeena Solar Inc company.
|
Analyst Detail |
Buy |
Outperform |
Hold |
Underperform |
Sell |
No Opinion |
|
Latest |
0 |
0 |
4 |
0 |
0 |
0 |
|
4 weeks ago |
0 |
0 |
4 |
0 |
0 |
0 |
|
2 months ago |
0 |
0 |
4 |
0 |
0 |
0 |
|
3 months ago |
0 |
0 |
4 |
0 |
0 |
0 |
|
Last year |
1 |
0 |
4 |
0 |
0 |
0 |
The 2 analysts offering 12-month price targets for AKNS have a median target of 1.38, with a high estimate of 1.50 and a low estimate of 1.25. The median estimate represents a 38.89% increase from the last price of 0.99.
Source: www.ft.com
|
|
# of Estimates |
Mean |
High |
Low |
1 Year Ago |
|
SALES (in millions) |
|||||
|
Quarter Ending Dec-09 |
4 |
7.72 |
8.00 |
7.50 |
19.94 |
|
Quarter Ending Mar-10 |
3 |
8.47 |
10.00 |
7.40 |
– |
|
Year Ending Dec-09 |
4 |
28.89 |
29.17 |
28.70 |
59.92 |
|
Year Ending Dec-10 |
4 |
51.15 |
57.50 |
39.90 |
– |
|
EARNINGS (per share) |
|||||
|
Quarter Ending Dec-09 |
4 |
-0.09 |
-0.09 |
-0.09 |
-0.12 |
|
Quarter Ending Mar-10 |
3 |
-0.08 |
-0.08 |
-0.09 |
– |
|
Year Ending Dec-09 |
3 |
-0.47 |
-0.47 |
-0.47 |
-0.52 |
|
Year Ending Dec-10 |
4 |
-0.26 |
-0.22 |
-0.29 |
– |
Source: http://www.reuters.com/finance/stocks/financialHighlights?symbol=AKNS.W
Investment Highlights
AKNS recently announced that for the first time, homeowners can purchase high-performing, easy-to-install solar panels off the shelves of a major retailer. The Company’s Andalay AC panels are available at 21 Lowe’s home-improvement stores throughout California. The panels, which were recently honored with a 2009 Popular Mechanics Breakthrough Product award, are featured as part of Lowe’s Energy Center at the stores. The Lowe’s Energy Center is a one-stop, easy-to-shop destination that empowers customers to create an energy plan that fits their budget and home-improvement goals. An information kiosk offers a touch-screen display to help customers evaluate their homes’ solar and wind potential, and the Energy Center features products that help them measure their energy use, reduce energy consumption and generate clean energy. Lowe’s is the first major retailer to offer many of these products in one place, products that range from power monitors and small solar chargers to a solar panel system. The Energy Center will be in additional U.S. and Canadian stores in 2010.
AKNS in late November announced a distribution partnership with Ontario-based Highland Solar to sell the Company’s award-winning Andalay AC solar panel system throughout Canada. According to terms of the agreement, Highland Solar will sell at least 1.75 megawatts of Andalay AC solar panels in Canada through 2010 through its network of local installation partners. Andalay AC panels have built-in racking, wiring, grounding and inverters, reducing the overall parts count by 80%. Andalay’s award-winning technology safeguards against performance-threatening breakdowns and delivers optimum performance with 5% to 25% more energy output compared to ordinary DC solar panels. Since Andalay AC solar panels produce household AC power, they eliminate complicated and dangerous DC wiring and provide a safer and easier installation process to solar installers, trades workers and do-it-yourselfers. The Andalay system is one of the first solar power systems to meet Ontario’s provincial content requirements, which require 40% of the content of solar systems to be sourced from Ontario. Ontario’s Feed-in-Tariff (FIT) provides generators of renewable energy a 20-year contract at a guaranteed price. Under the micro-FIT program, which includes solar systems of 10 kilowatts or less, homeowners are paid 80.2 cents for each kWh produced.
Source: http://www.akeena.net/
Technical Analysis
Source: http://stockcharts.com
AKNS’s recent volatility has been greater than normal. This is evidenced by the increased distance between the upper and lower Bollinger Bands. These bands measure volatility using standard deviation and a large width is due to high volatility. Additionally, AKNS is trading above its upper Bollinger Band. Relative to recent price action, the stock is currently overextended and due for either a pause or retracement.
The MACD for AKNS currently indicates a strong bullish signal for two reasons. First, the MACD is above the signal line, a 9-day moving average. Second, the MACD is above 0, which implies that the underlying moving averages are trending higher.
Comparative Analysis
|
Company Name |
Ticker |
Price per |
Mrkt. Cap. |
P/E |
P/S |
||
|
Dec-10-2009 |
symbol |
Share, $ |
$ Mn |
2009 |
2010 |
2009 |
2010 |
|
|
|
|
|
|
|
|
|
| Entech Solar Inc. |
ENSL |
0.08 |
19.40M |
n/a |
n/a |
1.92 |
n/a |
| Real Goods Solar Inc. |
RSOL |
3.45 |
63.08M |
n/a |
n/a |
1.09 |
n/a |
| Beacon Power Corp. |
BCON |
0.47 |
61.78M |
n/a |
n/a |
87.88 |
n/a |
| Renewable Energy Median |
|
|
48.08M |
n/a |
n/a |
30.29 |
n/a |
| Akeena Solar Inc. |
AKNS |
1.76 |
62.6M |
n/a |
n/a |
1.05 |
n/a |
Source: Thomson Financial
Insider Trading Activity
|
NET SHARES PURCHASE ACTIVITY Inside Purchases – Last 6 Months |
||
|
Shares |
Transaction |
|
| Purchases |
n/a |
0 |
| Sales |
10,000 |
1 |
| Net Shares Purchased (Sold) |
(10,000) |
1 |
| Total Insider Shares Held |
9.02M |
n/a |
| % Net Shares Purchased (Sold) |
(0.1%) |
n/a |
|
Net Institutional Purchases — Prior Qtr to Latest Qtr |
|
|
Shares |
|
| Net Shares Purchased (Sold) |
(1,393,210) |
| % Change in Institutional Shares Held |
(64.5%) |
Source: Yahoo Finance
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