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No. of Recommendations: 5
...in the after-market. Currently $14.00; down $10.88; -43.7%.

Here is the bad news press release:

American Superconductor, a global power technologies company, today issued an update regarding its anticipated financial results for its fourth quarter and fiscal year 2010 ended March 31, 2011. AMSC expects to report final fourth quarter and full fiscal year 2010 results in May 2011.

On March 31, 2011, Sinovel Wind Group Co., refused to accept contracted shipments of 1.5 megawatt (MW) and 3 MW wind turbine core electrical components and spare parts that AMSC was prepared to deliver. AMSC believes that Sinovel intends to reduce its level of inventory before accepting further shipments.

These delayed shipments are the primary cause for lower-than-anticipated financial results for AMSC’s fourth quarter and full fiscal year 2010. AMSC currently expects total revenues for its fourth fiscal quarter will be less than $42 million and that it will generate a net loss for the fourth quarter on both a GAAP and non-GAAP basis. As a result, AMSC currently expects its full year fiscal 2010 revenues to be less than $355 million. This compares with the company’s prior forecast for fiscal 2010 revenues of $430 million to $440 million. AMSC also expects that its GAAP and non-GAAP earnings for full year fiscal 2010 will be well below the company’s previous forecasts.


Since the Fool doesn't like press releases reprinting in total, here is the link to the rest of the story:

http://finance.yahoo.com/news/AMSC-Issues-Update-Regarding-b...

AMSC has been quick to underplay their reliance on one vendor. That will not be so easily dismissed in the future. The purchase of The Switch is now a big deal because it did bring diversity to the customer base and added revenue in a different wind technology. You have to wonder if the cash part of that deal needs to be rethought or if AMSC is going to borrow money to make the purchase. I also wonder if The Switch has a back door exit in the contract for an event like this that greatly reduces the value of the stock being offered to them in the deal.

This pushback from Sinovel could not have happened at a poorer time. I would normally be ready to buy this stock -- seeing today as an overreaction to news from an important company in an important industry. I will be looking at call options tomorrow and stock tonight but, for now, do not expect to be buying anything until the dust settles. If there wasn't a large acquisition in place, and the opportunity for management to muck the deal up with borrowing and/or issuing cheap shares of stock, I would be buying...

W.D.
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