Cautious Outlook: Sell Rating for Ballard Power Systems Amid Restructuring and Market Challenges

Analyst Jeff Osborne of TD Cowen maintained a Sell rating on Ballard Power Systems, retaining the price target of $1.00.

Jeff Osborne has given his Sell rating due to a combination of factors affecting Ballard Power Systems. The new CEO, Marty Neese, has initiated a restructuring plan to cut operating expenses by 30%, aiming for the company to become cash flow positive in approximately 10 quarters. However, there is a lack of detailed information on how these cost reductions will be achieved and the impact on the company’s technology development and cost reduction efforts.
Additionally, the company’s order backlog has decreased, with bookings for the quarter being notably low, indicating potential challenges in maintaining market share amidst a competitive landscape. The absence of guidance beyond operating expenses and capital expenditures adds to the uncertainty, making it difficult for investors to gain confidence in the company’s future performance. These factors contribute to Osborne’s cautious outlook and the Sell rating for Ballard Power Systems.