AONE - Deutche Bank

A123 Systems Inc. (AONE.OQ),USD8.83 Buy Price Target USD17

Dan Galves: EPS ($-033 to $-032) We hosted AONE at several investor meetings last week at DB’s Technology conf. We continue to believe that AONE can gain a significant share of the light-vehicle lithium-ion market, based on achievements to-date as well as comments from OEM’s and competitors that place AONE in the top 3 of battery suppliers. Key takeaways from this 1) We learned AONE is engaged with at least 8 passenger car co’s. 2) The “major OEM” program announced on the company’s 2Q10 earnings call will not require an add’l competitive bidding round. 3) Heavy-duty and Grid storage programs appear to be accelerating and could represent 40%-50% of company revenue in 2013. TP: $17, Buy Rating