Date: 14/6/11
Broker: Jefferies
Company: Ceres Power
Share price: 40.25p
Target price: 85p
Recommendation: Hold
Ceres Power is developing a fuel cell-based domestic boiler and it has an agreement with British Gas.
Ceres announced the resignation of CEO Peter Brance. Brian Count, the company's chairman, will act as interim CEO until a replacement can be found.
Jefferies regard the news as unsurprising (given the share price volatility and roll-out delays), but comment that the timing is not good as the company is at a critical point in its development, running field trials of its micro-CHP solution with a view to a commercial launch probably in 2013.
Jefferies believe that the upside potential of Ceres Power, if it succeeds in commercialising its micro-CHP product for the domestic home, is enormous but say the company needs to work hard at solidifying investor interest and confidence, especially if they plan to raise capital. Jefferies expects continued volatility in the share price in the interim.
