Wedbush Lowers PT To $9 On ENOC

Wedbush has lowered its price target on EnerNOC Inc. ENOC from $11 to $9 based upon uncertainty in the company's future. Says Wedbush, in its report, “FERC filed an Order accepting PJM's proposed rule changes eliminating double counting, and suspending implementation of the rule changes until Nov. 7, pending the outcome of a technical conference and another FERC Order. FERC ruled that changes to PJM's tariff would not be retroactive rule-making as the approved changes represent a prospective revision of measurement and compliance rules, which are permitted by law. FERC Staff is now required to convene a technical proceeding within 60 days (by Aug. 6). We expect key issues at the technical conference to be treatment of behind the meter generation, where we hear the most significant abuses are occurring, and whether PLC is an appropriate metric for measuring DR capacity. (The issue may be open to interpretation, as PLC is a proportionate representation of capacity procured for an individual customer determined five months before the delivery season, similar to a bottom-up analysis, while system capacity is procured at auction three years in advance, and in incremental auctions, using peak consumption forecasts, similar to a top-down analysis.) FERC also clearly differentiated the character of DR for capacity and energy markets, where EnerNOC relies on obfuscation of principles to justify measuring DR above PLC.” Wedbush reiterates an Underperfrom rating on the stock. ENOC closed at $16.21 on Friday.