Fuel Systems Solutions (FSYS) Smashes Lowball Estimates, Surges AH

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05:31:34 pm on May 7, 2009

Last quarter expectations were much too high for the former high flyer, Fuel Systems Solutions (FSYS).  The company didn’t match those lofty expectations and the stock has taken a beating.  Now that analysts have very little expectations of the company it doesn’t take much to beat and beat they did after the bell today.  The company reported an EPS of .44/share which was more than double what analysts had expected.  Let’s not get carried away though.. although the company doubled analyst estimates it was still only 10% EPS growth over the year ago quarter on revenues that were 15% less than the year ago quarter.  Granted those comparisons are to the  glory days when the company was posting huge quarterly growth, so the results should be enough to give the stock a decent pop in the coming weeks.

For the full year 09 the company reaffirms guidance and expects between $330 – $360 in revenues which assumes a stronger US dollar that is estimated to negatively impact revenue by 12%.  Why any company would assume a stronger US dollar in the future is beyond me!  Perhaps there will be a surprise upside due to a weakening dollar.

It will be interesting to see what kind of impact the Phill system they purchased from FuelMaker has on their bottom line.  I personally think it was a great move by FSYS.

Fuel Systems (FSYS) is surging after hours, up nearly 15% on this earnings report.

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Comments  

“Phill” by itself will have little impact on FSYS business, unless they sink a fortune in it (like FM did) and lose their shirts. The Fuelmaker purchase will be quite profitable because the products are already designed and there is already an installed base of some 14,000 units and a backlog to make more. But only a small percentage of those are Phills.

Phill needs first of all to become a reliable and economical product. It has had too many warranty failures which cost FM a lot of money and many premature out of warranty failures which costs Phill customers a lot of money. FSYS needs to find a way to service these units at a cost which makes home fueling with Phill competitive with buying gasoline. Sadly, it has not been so far.

 

thanks for your insight on this

 
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