Penny Stock Capstone Turbine (CPST) Gets Upgrade To $2.00

A Turbine generator making penny stock that investors love to short got a huge endorsement of its product quality this weekend. According to the company website, Four Seasons Hotel Philadelphia recently installed three Capstone Turbine Co. (NASDAQ: CPST) C65 ICHP MicroTurbines, the company’s largest product in backlog orders, which is projected to decrease by 30% the luxurious hotel’s annual energy expenses. Shares in recently upgraded CPST dropped Friday when the company reported earnings that fell short of analysts’ estimates.

The penny stock with consistently high short interest reached as high as $1.53 during the week and is commanding attention as CPST has now posted positive gross margins in 5 of the last 6 quarters. Capstone Turbine Revenue was identical for fiscal 2012 in Q3 and Q2; $27.5 million. Backlog orders saw an increase of $30 million to over $115 million for the same period last year. The backlog totals 641 units,  more than half of which are C65 ICHP MicroTurbines, all of which are current and planned to be shipped within the next twelve months.

CPST Share Statistics
Avg Vol (10 day): 6,073,060
Shares Outstanding: 259.75M
Float: 258.14M
% Held by Insiders: 0.62%
% Held by Institutions: 42.10%
Shares Short (as of Jan 31, 2012): 39.26M
Short Ratio:  15.40
Short % of Float:  17.10%
Shares Short (prior month): 40.40M


CPST was upgraded by analysts at Ardour Capital from an “accumulate” rating to a “buy” rating and now have a $2.00 price target on CPST, up previously from $1.50. Capital IQ reports the average analyst opinion on CPST is an outperform rating and a price target of $2.39.

CPST closed Friday, February 10, 2012 down 9.64% (-0.13) at $1.265. CPST is trading -40.89% below its 52-week high, $20.40, and 48.82% above its 52-week low, $0.85.

CPST has been hovering over the $1.16 level for nearly one month now and subscribers will be notified if the stock reaches near that resistance level, a 30% discount from the high it reached last week.

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