Top Analyst Slashes Price Target for Uni-Pixel Inc (UNXL)
Roth Capital’s top analyst Brian Alger is out with a new research note on shares of Uni-Pixel Inc (NASDAQ:UNXL), after the touch-screen technology maker reported in-line fourth quarter-results, offset by lower-than-expected gross margin as the company incurred roughly $1.5 million of start up costs prepping for new designs. Uni-Pixel shares are currently falling nearly 7% to $84.
While Alger reiterates a Buy rating on UNXL, the analyst slashed the price target to $2.00 (from $3.00), which implies an upside of 122% from current levels.
Alger commented, “We are reducing our price target from $3.00 to $2.00 to reflect the significant dilution that has been introduced over the past 3 months. While basic shares out standing are only 56 million shares, the additional shares linked to preferred stock and warrants takes the current fully diluted share count up over 80 million shares. Moreover, the deal struck in January has the potential to trigger additional share dilution if the stock remains below the last conversion price of $0.95.”
“Perhaps most noteworthy was the disclosure that the GIS agreement has not yet closed. It appears to us that GIS is attempting to improve its terms and is holding out against UNXL […] Importantly, however, UNXL also discussed a second potential ODM partner from China. Discussions with this second partner are believed to be quite advanced and are being negotiated CEO to CEO. We are optimistic that UNXL will be able to gain this second validation from the market, as we believe it could strengthen the company’s stance with GIS, not to mention improve the fundamental foundation of the company,” the analyst added.
According to TipRanks, which measures analysts’ and bloggers’ success rate based on how their calls perform, 5-star analyst Brian Alger has a yearly average return of 36.2% and a 63% success rate. Alger has a -36.5% average return when recommending UNXL, and is ranked #71 out of 4558 analysts.