A123 plunges after firm dampens new technology enthusiasm

Shares of electric vehicle battery maker A123 Systems (AONE) are given back a significant portion of yesterday’s gains after research firm Wunderlich Securities wrote that the company's new battery technology won't solve its financial problems. A123 Systems rallied yesterday after the company said that it had developed a new material that could be used to solve the heating and cooling issues facing electric car batteries. But Wunderlich said its checks indicate that it may be years before these technologies can be sold to customers. A123, which is having serious financial difficulties, cannot afford to wait years for a solution to its problems, the firm contends. In fact, Wunderlich believes that the company needs more than $400M in additional funds in order to survive the next 18 months. The firm reiterated a 50c target and Sell rating on the stock. In mid-morning trading, A123 tumbled 26c, or 16.46% to $1.32.