By early afternoon Wednesday, shares had tumbled 7.3%. Trading volume of 3.2 million was nearly triple its three-month daily average.
The nano-cap exploded 74.2% over Tuesday's session after announcing it had received a new Honda (HMC) vehicle award. The Ventura, Calif.-based business said it had begun the manufacture of catalysts featuring its high-performance Mixed Phase Catalyst (MPC) technology for the Honda 2015 Acura TLX model.
The developer of engine and emissions-control systems said it expects shipments of the catalysts to commence in the first half of 2015.
Clean Diesel also provided its catalyst solutions to other Honda models including the North American versions of its four- and six-cylinder Accord, Acura TS and RLX.
"Having our advanced catalyst technologies on a growing number of Honda vehicle platforms (currently 6) is a testament to CDTi's ability to provide market-leading solutions to our customers. The demand for greater emission reduction continues to grow across all vehicle segments," said Clean Diesel CEO Nikhil Mehta in a statement. "Our MPCtechnology is well suited to meet this trend."
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TheStreet Ratings team rates CLEAN DIESEL TECHNOLOGIES as a Sell with a ratings score of E+. The team has this to say about their recommendation:
"We rate CLEAN DIESEL TECHNOLOGIES (CDTI) a SELL. This is based on some significant below-par investment measures, which should drive this stock to significantly underperform the majority of stocks that we rate. The company's weaknesses can be seen in multiple areas, such as its generally high debt management risk, disappointing return on equity, weak operating cash flow and poor profit margins."