First Albany raised its recommendation on Capstone Turbine (CPST) to buy from neutral, citing the electrical equipment company's strategic focus.
Analyst Sanjay Shrestha said that channel checks and management/distributor meetings support Capstone Turbine's strategic focus on product reliability, cost reductions, competitive positioning, and enhanced distribution channels. Shrestha said that over the long term, he expects the company to leverage large potential in the distributed generation market, driven by a clear economic value proposition, growing traction in New York City, and incremental benefits from the Energy Bill. Shrestha sees a 55 cent earning per share loss for the fiscal year 2006 (ending March,) and a 40 cent earning per share loss for the fiscal year 2007. His price target is at $6 per share.