Raser Technologies Reports in line - Analyst Blog

Raser Technologies Inc. (RZ) reported a quarterly loss per share of 11 cents, in line with the Zacks Consensus Estimate for the quarter. In the year-ago quarter, the company incurred a 9-cent loss.

Raser Technologies clocked quarterly revenues of approximately $1.0 million. In the year-ago quarter, the company did not generate any revenues. The improvement was due to the initiation of a revenue stream from selling electricity generated by its geothermal power plant for the city of Anaheim in California.

The electricity plant became operational from the second quarter of 2009. In the reported quarter the company generated approximately 11,543 MW hours of electricity, which was sold at a price of $79.56 per MW.

Cost of sales for the reported quarter was $2 million compared to nil in the year-ago quarter. Gross loss was approximately $1 million for the first quarter of fiscal 2010.

Total operating expenses decreased to $4 million for the first quarter of 2010, compared to $5.3 million for the first quarter of 2009. General and administrative expenses were approximately $2.5 million, consistent with the year-ago quarter. Power project development expenses totaled $1.3 million, compared to $2.1 million for the first quarter of 2009. Research and Development expenses decreased to $0.3 million from $0.7 million in the year-ago quarter. Raser’s net loss was $8.8 million compared to a net loss of $6.7 million in the year-ago quarter.

Raser reported cash and cash equivalents of $2.7 million and restricted cash of approximately $29.3 million at the end of the reported quarter. Long term liabilities remained flat at $79.6 million at quarter-end compared to $79.7 million at fiscal-end of 2009.

Raser like its peers Emerson Electric Company (EMR), and China Electric Motor Inc. (CELM) is currently valued entirely on very optimistic future expectations. However, in the near term, limited revenue potential, mounting losses and dependence on external funds will continue to weigh on the cash-strapped company. In the second quarter of 2010 we expect the company to incur a loss of 11 cents per share.

The trend is expected to turn for the better in fiscal 2011, which will coincide with the commencement of production at its multiple geothermal plants, PPAs, and Symetron’s progress in SUV demonstration vehicle and heavy duty alternators.

Accordingly, in view of a mixed outlook we rate the Zacks Rank #2 stock as Neutral.