Electrovaya keeps “Buy” rating at Roth

Ahead of what he expects to be busy times, Roth MKM analyst Craig Irwin has maintained his “Buy” rating on Electrovaya (Electrovaya Stock Quote, Chart, News, Analysts, Financials NASDAQ:ELVA).

The analyst says he expects some developments are imminent.

“We are watching for a debt facility to support the buildout of the Jamestown, NY facility which lifts medium-term growth visibility,” he wrote. “We believe management is pursuing a variety of favorable programs including Federal and NY State loan facilities. Electrovaya is slated to invest $35 million to build out an initial 300 MW capacity. The plant will come online in phases starting in June 2024 with pack and module production, followed by cell production toward the end of 2024. Electrovaya has already secured $6.5M in federal and local incentives for the facility, and IRA funding could deliver a 500 to 1,000 bps uplift to gross margins, on $45/kW total funding.”

In a research update to clients March 26, Irwin maintained his “Buy” rating and one-year price target of $8.00 on ELVA.

The analyst thinks the company will post EBITDA of $10.5-million on revenue of $70.0-million in fiscal 2024. He expects those numbers will improve to EBITDA of $25.0-million on a topline of $110.0-million in fiscal 2025.

“We reiterate our $8.00 target, using a 12x EV/EBITDA multiple on our 2025 (Sept) estimate of $25M. We see a 12x multiple as fair for the company’s leadership position in heavy-duty lithium-ion batteries, and the longer-term growth outlook, but acknowledge the multiple is higher than profitable industrial battery peers,” he concluded.