Solazyme (SZYM) Expects H215 Revenue Acceleration on Product Line Expansion, New Product Introductions - Cowen

Cowen and Company maintains its Market Perform rating on Solazyme, Inc. (Nasdaq: SZYM) and moves its price target from $3 up to $4 following the company's Q1 announcement on Wednesday night.

Analyst Jeffrey Osborne noted that the firm was expecting Solazyme to report Q1 loss of $0.34 per share on revenue of $15.3 million, while the company actually reported Q1 loss of $0.37 per share and revenue of $12.6 million.

Osborne noted management commentary calling for continued revenue expansion in H215 from the launch of several new product lines as well as the expansion of the following lines:

• Solazyme is continuing to build out its partnership with Bunge to develop unique food ingredients, with the past quarter marking the best performance to date for food products. Importantly, three new customers were added this quarter and the Glanbia partnership should help to further expand product offerings.
• Algenist performance was strong in the quarter with revenue totaling $6.2 million, up 26% y/y. This due to a larger distribution footprint (2,500 stores) as well as two additional product SKUs (36 SKUs Total). Solazyme expects revenue to remain flat in the second quarter and pick up in the back half of the year in line with additional product releases.
• Encapso continues to gain traction in the oil and gas industry as its geographic footprint expands (N.A., S.A., and M.E.). Solazyme announced a partnership with Flotek Industries to develop and distribute drilling lubricants and chemical additives for use in oil and gas drilling application. Importantly, Flotek has agreed to a minimum purchase order for the 2015 year. Flotek will assist in the distribution of Encapso in the M.E., while both companies will jointly develop and market a new product called Flocapso

For an analyst ratings summary and ratings history on Solazyme click here. For more ratings news on Solazyme click here.

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