Stockchase Opinions

Stockchase Insights Xebec Adsorption XBC-T COMMENT Jan 28, 2022

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. The estimates for the next report is $43.7M in sales. They need to show improving margins and more contracts for the momentum to turn. Cash has gone down, so cash flow is important. Capital raise would be a worry. Needs a strategic review to turn it around probably. Unlock Premium - Try 5i Free

$1.750

Stock price when the opinion was issued

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HOLD

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. The quarter showed improvement with revenues beating estimates at $46M. EPS was 2 cents, which was also better than expected. Net losses and gross margins also improved. Good results overall that will reassure investors. Unlock Premium - Try 5i Free

BUY ON WEAKNESS

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. The stock has sold off dramatically and likely has good potential from current levels. Management is still in the penalty box due to the reporting issue but this is priced in already. ESG is a tailwind. Investors seem to be liking the 3 year strategic plan that management announced. Unlock Premium - Try 5i Free

COMMENT

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. They announced a very nice contract. There was a MOU that was announced in March though, so investors had a heads up. The time frame was not disclosed. Sales estimates for 2022 were just under $200M, though there was some impact from previous announcements in the forecast. Unlock Premium - Try 5i Free

TOP PICK

Believes that renewable natural gas demand will increase. Latest investor day outlined 40% compounded growth the next three years. Recently signed a contract that was bigger than expected.

HOLD
Cheap. Recent quarter was a disaster. He's monitoring it. Regulatory change on renewable natural gas will be a strong tailwind for quite some time. Challenging environment now. Supply chain issues have increased costs. Management knows what they're doing.
COMMENT
He likes the renewable natural gas business. Has owned in the past but not now. Xebec has had challenges achieving its numbers promised to the street. Wait for a turnaround and move to profitability.
WATCH
They had more challenges then Greenlane Renewables and their market cap was at once much larger than GR's. Shares have fallen further than GR. The sector has a tailwind, though, for the next decade. See if XBC delivers a couple of strong quarters. Wait to see if XBC operates better. There is a lot of runway ahead, though.
HOLD
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. Continues to expand globally via partnerships. Disappointing fourth quarter. RNG and hydrogen tailwinds. Lower valuation risk.
HOLD
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. Continues to expand globally via partnerships. RNG and hydrogen tailwinds. Lower valuation risk.