NEW YORK — Shares of Headwaters Inc., which turns coal into liquid fuel, closed down 15 percent Wednesday after one of the company's biggest customers, DTE Energy Co., said it might cut production.
"DTE comprised approximately $20 million of Headwaters' revenue during fiscal year 2002 and represented Headwaters' second largest Synfuel customer during the year," Adams Harkness & Hill analyst Eric Prouty wrote in a research note Wednesday.
Officials at South Jordan-based Headwaters weren't available to comment.
Prouty downgraded shares of Headwaters to "market perform" from "strong buy," citing the threat of DTE production cuts. The analyst doesn't own stock in any of the companies mentioned.
DTE owns the synthetic fuel plants, but it licenses the synthetic fuel technology and buys a chemical reagent from Headwaters.
Separately, there was a report Wednesday that Citigroup sold most of its Headwaters stake — about 1.6 million shares, or a 6 percent stake.
Prouty views the sale, which has been expected since October, as a positive for the stock, saying it has eliminated an overhang in the price.
Shares of Headwaters closed at $16.79, down $3.03, or 15.3 percent, Wednesday on the Nasdaq Stock Market.