Nexxus Lighting (NEXS) remains a micro cap LED stock with a ton of potential.  With a Lowe’s deal in place and a focus on the consumer market, the company could see tremendous growth in the coming years IF LED lighting costs come down far enough to reach the average consumer.  The company is seeing nice revenue growth off a small base, but profits remain elusive up to this point. 

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On Friday, the company reported an EPS loss of .05/share on revenues of $4.1 million,  both of which were about inline with analyst estimates.  Revenues for its Array LED replacement bulbs soared 647% over the year ago quarter to $3.2 million.  Now that Nexxus has made the initial shipment to all Lowe’s stores, costs should come down a bit getting the company closer to profitability.  However, the company isn’t expected to turn a profit until later in the year or next year.  You’ll want to get into shares of NEXS before that happens.

"Our record Array results for the quarter reflect the expansion of our market strategy into the consumer market channel," commented CEO Mark Bauer.  "While we incurred some unexpected freight and installation costs, we were able to deliver 100% of the product on time to each of the approximate 1,100 stores.  This performance demonstrates our ability to cost-effectively ramp our capacity and profitably service this new channel.  There were challenges faced in this effort, but we overcame them with a team effort that included the support from certain strategic vendors."

"Our attention now turns to supporting the sell-through process of the Array product and expanding this channel," added Mr. Bauer.  "Point-of-sale educational displays and graphics are being created, along with other consumer marketing materials, that highlight the benefits of LED lighting and our Array products in particular.  We will be conducting training sessions with Lowe’s commercial sales professionals over the next few months.  Finally, we are working with Lowe’s representatives and utilities to pursue rebates for consumer purchases.”

Technically, shares of NEXS remain in a downtrend off the surge in March after announcing the Lowe’s deal, but an entry around the $2 level is very compelling considering it’s about 50% off that Lowe’s surge.  If indeed this company turns a profit in 2012 as it’s expected to do, shares could easily double or triple from current levels within 6 months to a year.