Esco (ESE) Soars, Itron (ITRI) Plummets On News Esco May Win Sempra Energy (SRE) Gas Smart Meter Contract

Sempra Energy (SRE) will soon make an announcement as to which company will win the estimated $400 million smart meter contract.  It had been thought that Itron (ITRI) would win the contract, but today Esco Technologies (ESE) announced it was selected by Sempra for “negotiation of a definitive agreement”. 

RBC Capital Markets analyst Stuart Bush called the move unusual and said it implies Esco has a leading position in negotiations.  Stifel Nicolaus analyst Jeff Osborne said the contract was part of the bullish case for Itron and would be a major loss.  Couldn’t have put it better myself.  As the stock was getting crushed, down nearly 15%, JP Morgan defended the stock saying that Itron could still win a piece of the Sempra business.  It sent shares about 10% off the lows, closing down less than 8%.  Esco shares soared nearly 25% today, helping make the case that the $25 level will hold as a major area of long term support.

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