Cormark: Eguana Tech Is “On The Cusp Of Realizing Its Long-Awaited Promise”

This past week Eguana Technologies (TSXV: EGT) announced that it had received its first micro inverter order from the Omega Group for almost 26,000 units. The order is said to have a combined value of just slightly over $7 million. They say that the initial bulk shipments are currently in-transit with fulfillment orders expected to start shipping in the next 4 weeks.

Currently, Eguana Technologies has 3 analysts covering the stock with an average 12-month price target of C$0.72, or an upside of almost 200%. All 3 analysts have buy ratings and the street high price target sits at C$0.75, which represents an almost 215% upside to the current stock price.

In Cormark Securities’ note on the news, they reiterate their buy rating and C$0.70 12-month price target, saying that they view this news as overall positive. They note that Eguana’s PV microinverters being offered are expected to deliver “15% more energy, and with single-, dual-, and quad-PV configurations, installers have more options to optimize rooftop configurations.”

Cormark also highlights that currently the PV microinverter market is held by a small number of players, which could potentially change in the coming years as power storage partners are seeking ways to have a more diverse set of options.

Currently, Cormark has not modeled any “significant” revenue coming from PV microinverters as they are waiting for “signs that the ramp-up of the energy storage systems is well in hand,” but say that this is a very encouraging sign that the revenue opportunity for Eguana is “building rapidly.”

Lastly, with this news Cormark now expects Eguana to grow shipments of their Duracell-branded energy system to a quarterly run rate of over 1,000 units later in the year. With that, they expect that the lumpy revenue growth quarters will be gone and expect the company to see increased EBITDA all the way into 2024.

They end the note by writing, “While there is still risk given the false starts of the past, the US market is growing rapidly, suggesting EGT is on the cusp of finally realizing its long-awaited promise.”

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