Shares of Santa Ana-based Fuel Systems Solutions Inc. soared more than 25% Friday, a day after beating Wall Street expectations and raising its forecast for the year.
The company has a market value of about $820 million.
The maker of kits that convert cars to run on natural gas and propane said Thursday that it made $4.6 million for the second quarter, compared to $395,000 a year earlier.
Analysts polled by Thompson Financial were looking for a $4.3 million profit.
Sales were up 50% to $98.3 million, well ahead of the $93 million analysts were expecting.
President Matthew Beale attributed the increase to strong demand for alternative fuel kits in Europe, Asia and Latin America and expects the trend to continue.
Fuel Systems raised its 2008 sales outlook for the second time in three months, and now expects to pull in $350 million compared to its previous estimate of $320 million. On average, analysts were expecting $355 million.
Fuel Systems is the holding company for Impco Technologies Inc., a maker of engine parts for propane and natural gas vehicles, and Italy’s BRC Gas Equipment SRL, which makes gear for converting vehicles from gasoline to alternative fuels.
Higher oil prices have made Fuel System’s kits more popular, especially for Europeans who pay more for gas, and who consider the cost of the kits, which can range between $2,000 and $10,000, a better deal.
Better accessibility to natural gas and propane fueling stations in Europe has also helped, according to the company.
In the U.S., where sales haven’t been as strong as Europe, the company mostly markets its conversion kits to industrial companies that have fleets of cars and trucks that can use the kits more economically.
The company has made plans this year to double the size of its plant in Livorno, Italy to make twice as many kits.
