Polypore sells into the traditional lead acid battery space and into the lithium ion market for all electronics, but it's the electric car market outlook that Johnson focuses on in saying that investors are missing the carnage to come -- his report is titled "There Will Be Blood."
A123 Systems (AONE) shares have declined 90% since its IPO three years ago. It remains beholden to the ramp from electric car maker Fisker. A123 Systems has burned through a mountain of cash and continues to lose money on every battery it sells. While negative gross margins are typical of high-risk emerging industries, the cash issues at A123 Systems have made it a terrible investment.
Recently, when Fisker announced a delay in its ramp, Wunderlich Securities analyst Theodore O'Neill described it as a positive for A123 because it meant the battery company wouldn't have to spend as much cash in the short-term, a sign of just how tight the cash situation is.
A123 peer, Ener1 (HEV), last year embarked on a shift in strategy as its business fortunes flailed, with its CEO saying the electric car market would take years to be profitable and it would instead focus on energy storage opportunities in the utility space. The Ener1 CEO was later ousted and the company now trades as a pink sheet.Sales of GM's Volt
Eric Rosenbaum. >To follow the writer on Twitter, go to Eric Rosenbaum. Follow TheStreet on Twitter and become a fan on Facebook.
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