MDB Capital Downgrades Ener1 (HEV) to Sell, Suspends Earnings Model and Valuation on Stock No Longer Justified
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MDB Capital downgrades Ener1, Inc. (AMEX: HEV) to Sell.
MDB analyst says, "Think Global, Ener1's most important near-term customer, announced it was temporarily halting production of its Think City electric vehicle due to working capital constraints. The company, which unsuccessfully approached the Norwegian government for direct support, reportedly needs between $15 million to $29 million in short term loan guarantees as a means to finance its current operations and planned expansion. We are now hearing that Think Global has been unable to find other funding sources and that the Norwegian government has again refused to provide the needed capital for continued operations. It now appears that there is a real likelihood of Think Global ceasing operations or at the very least scaling back to a much smaller enterprise. In any event, it now seems that Think Global will not be able to uphold its end of the $70 million contract with Ener1 for the delivery of batteries for the Think City vehicle. Without this contract Ener1 has little in the way of other contracts that might generate near term revenues and the valuation of the stock is no longer justified."
Ener1, Inc. (Ener1) has three business lines that it conducts through its three operating subsidiaries. EnerDel, Inc., an 80.5% owned subsidiary, which is 19.5% owned by Delphi Corporation, develops lithium ion (Li-ion) batteries for automotive, military and other industrial uses.
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Comments
Your wrong
As of yesterday Jan. 7, 2009, Think Global has raised part of the money needed to stay in business, and is back in partial production. It's now looking for more funding. Check you facts before you write!
Ener1
Why do you keep reporting that Delphi owns any of ENER1...it was bought out months ago..
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Based on wrong assumptions
jules on Jan 9, 2009 08:58 AMYes, once again MDB is basing their recommendations on the rumor mill and not researching completely. You are doing a grave disservice to your clients!