Energy Conversion Devices (NASDAQ: ENER) tumbled to a new 52-week low today as investors panned the company's earnings report. This morning, ENER confessed to a fourth-quarter loss of $15.8 million, or 37 cents per share, more than reversing its year-ago profit of 24 cents per share. Revenue for the period tumbled 38% to $51.4 million. Both figures fell short of analysts' consensus estimates, which called for a loss of 8 cents per share on $55 million in revenue.
"Demand for solar products in our target markets weakened further from the third quarter into the fourth quarter as commercial construction declined, building owners deferred reroofing projects and project financing constraints continued," explained Chief Executive Mark Morelli.
In the wake of this lackluster report, ENER fell to an intraday nadir of $11.70, marking its lowest price since August 2004. Today's technical weakness is nothing new for the solar energy issue. Since September 2008, the stock has been ushered consistently lower by double-barreled resistance at its 10-week and 20-week moving averages.
As a result of ENER's long-term slide, short sellers have amassed a sizable position against the security. Short interest rose by 6.8% during the most recent reporting period, and now accounts for a hefty 30.7% of the equity's available float. Judging by today's plunge, some of these bears might be doubling down in light of ENER's fundamental fumblings.
Elizabeth Harrow is an analyst and financial writer in the research department at Schaeffer's Investment Research. She is featured in the video series Schaeffer's Daily Q&A on SchaeffersResearch.com.
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