Goldman Sachs Downgrades A123 Systems (AONE) to Sell, Sees 30% Downside

Goldman Sachs downgraded A123 Systems (NASDAQ: AONE) to Sell and cut their 6-month price target to $2.50, suggesting 30% downside potential.

The firm sees risk to transportation segment unit volumes which could suggest another capital raise in challenging market conditions.

The company has two paths forward: 1. push out the scale-up to conserve cash while executing on current contracts; 2. secure new funds to support near-term capacity growth plans. "Assuming tepid current market appetite for the latter, our new estimates and target reflect a more protracted ramp toward profitability, with limited downside cushion, in 2012-2015," the analyst said.

For more ratings news on A123 Systems click here and for the rating history of A123 Systems click here.

Shares of A123 Systems closed at $3.55 yesterday.

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