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Water Tower Research

Research from Water Tower Research

Water Tower Research is a leading equity research firm that provides research on micro, small and mid cap companies.

Water Tower Research was founded by Wall Street veterans after witnessing a fundamental shift in the investment research industry with the result being a declining knowledge base among investors, a lack of awareness and a shrinking pool of fundamental research being conducted on companies across the small-cap and micro-cap spectrum. The same issues are now increasingly occurring in the mid-cap space. This sea change within the investment community is impacting not only the companies themselves but also current shareholders and potential investors. With significantly less active sell-side sponsorship by Wall Street, a substantial information gap has developed between companies and various constituents in the financial community. The net result is fewer channels for insight and information to flow between companies and investors.

Equity Research Firm

Thematic (Sector/Industry)

SUMMARY
Last Week’s Events
SES AI Corp. (SES)

Fireside chat with CEO Dr. Qichao Hu who provided an overview of SES’s strategic initiatives and technology roadmap in Li-Metal batteries.

Westport Fuel Systems (WPRT)

Fireside chat with CEO David M. Johnson who discussed Westport’s leading technologies that are already helping to power the transition to cleaner transportation solutions.

Last Week’s Research
Aqua Metals, Inc. (AQMS)

Full-Scale Commercialization of Its AquaRefining Technology Expected by End-2022

Aspen Aerogels, Inc. (ASPN)

+36.7% Revenue Growth; Expansion Via Plant 2; Management Lays Down FY22 Outlook

Previous Research
Aqua Metals (AQMS)

Recording Significant Progress with LiNiCo in Lithium-ion Battery Recycling
Leading the Way in Sustainable Lithium-Ion Battery Recycling, Helping Reduce the Carbon Footprint of EVs

Electrovaya (EFLVF)

1Q22 Results: On Course to Fulfill an Aggressive Revenue Target of $27 Million in FY22

Crown Electrokinetics (CRKN)

Progress Continuing for Smart Window Solutions in the Commercial Retrofit Market
Looking Through the Window Into Smart Glass Solutions For The Commercial Retrofit Market
CEO Doug Croxall Discusses Its Smart Glass Technology and Transition to Commercial Scales

INDEX STATISTICS



ABOUT THE WTR INDEX
The WTR Sustainable Investing Index is built on 148 companies in four primary segments with multiple sub-sectors: 1. Energy Technology (including Power Generation, Hydrogen &amp; Fuel Cell, Energy Storage, and Lithium Supply Chain); 2. Modern Mobility (Advanced Motive, EV Charging, Smart Driving); 3. Industrial ClimateTech; 4. Smart Buildings. The index monitors share price performance, valuation metrics, and consensus estimates. Our weekly reports also cover industry activity and news flow.
SUMMARY

WTR Sustainable Index: During the week ended February 25, 2022 the WTR Sustainable Index underperformed the broader market and was down 3.9% W/W versus the S&amp;P 500 Index’s 0.8% increase, the Russell 2000 index (up 1.1%), and the Nasdaq Composite Index (up 1.6%). Energy Technology and Smart Buildings sectors saw positive returns last week with 3.3% and 0.5% respectively. By contrast, Modern Mobility was down 5.4% and Industrial ClimateTech down 0.4%.
Valuation: Based on forward 12-month consensus estimates, the current P/E ratio of the WTR Sustainable index is 26.7x vs. 21.2x for the S&amp;P 500.
Consensus estimates changes: During the week ended February 25, 2022 there were&nbsp;increases&nbsp;in 2022 revenue estimates for four companies in Energy Technology, one in Modern Mobility, and two in Smart Buildings. There were&nbsp;decreases&nbsp;in 2022 revenue estimates for two companies in Energy Technology and one company each in Modern Mobility and Industrial ClimateTech. Five companies (three in Modern Mobility and two in Smart Buildings) saw&nbsp;increases&nbsp;in 2022 EPS estimates, while six companies (five in Energy Technology and one in Modern Mobility) saw decreases in 2022 EPS estimates.

SHARE PRICE PERFORMANCE SUMMARY
Share Price Performance
OPTT shares were up 19% due to short covering. VLTA shares were down 19% following news of the expansion of its collaboration with Walgreens.




Consensus Estimates
Figures 7-8 show W/W changes in FY22 revenue and EPS estimates for selected companies in the WTR Sustainable Index. For the week ended February 25, 2022 there were seven increases and four decreases in FY22 revenue estimates, and five increases and six decreases in FY22 EPS estimates.
Figures 9-10 show the number of companies with W/W changes in consensus revenue and EPS estimates by sub-sector for FY22E.















KEY INDUSTRY AND COMPANY NEWS OF THE WEEK
Energy Technology
DOE Deep Dives into Strategies To Solve Clean Energy Supply Chain Issues
https://pv-magazine-usa.com/2022/02/24/doe-deep-dives-into-strategies-to-solve-clean-energy-supply-chain-issues/
Supply chain problems helped drive up the cost of solar power equipment last year, but are expected to ease in 2022, according to&nbsp;Wood Mackenzie. The U.S. Department of Energy is examining the issues surrounding the overall clean energy manufacturing supply chain, and recently published “America’s Strategy to Secure the Supply Chain for a Robust Clean Energy Transition”. The strategy is part of a US government approach to chart a course for revitalizing the economy and domestic manufacturing by securing the country’s most critical supply chains. DOE’s Office of Energy Efficiency and Renewable Energy (EERE) released&nbsp;seven deep-dive assessments&nbsp;of clean energy manufacturing supply chains. Each of the seven assessments, one of which is solar, focuses on a different technology or resource that will help the Biden Administration achieve its goal of net-zero carbon emissions by 2050. “The transition to a clean energy economy cannot proceed without a steady supply of the materials and components required to manufacture clean energy products,” said Kelly Speakes-Backman, Principal Deputy Assistant Secretary for EERE. “The assessments released today highlight the wealth of opportunities that will come with domestic supply-chain expansion, including new jobs, new manufacturing infrastructure, and faster, cheaper deployment of clean energy technologies.”
ARPA-E Awards Over $8 Million in AM Clean Energy Projects
https://www.pm-review.com/arpa-e-awards-over-8-million-in-am-clean-energy-projects/
The United States Department of Energy (DOE) has announced $175 million for sixty-eight research &amp; development projects aimed at developing novel advanced energy technologies. Led by DOE’s Advanced Research Projects Agency-Energy (ARPA-E), the OPEN 2021 program prioritizes funding high-impact, high-risk technologies that support novel approaches. The selected projects are anticipated advancing technologies for a wide range of areas, including electric vehicles, offshore wind, storage and nuclear recycling. The selected projects will focus on technologies such as revolutionizing fuel cells for light- and heavy-duty vehicles, and technologies to generate less nuclear waste and reduce the cost of fuel.
Chevron Announces Investment in Carbon Clean CO2 Capture Technology Business
https://www.chevron.com/stories/chevron-announces-investment-in-carbon-clean-co2-capture-technology-business
Chevron U.S.A. Inc., a subsidiary of Chevron Corporation (NYSE: CVX), announced it has made a new investment in Carbon Clean, a global leader in cost-effective industrial carbon capture. The size and cost of installing carbon capture technology has been a barrier to adoption. Carbon Clean’s technology is designed to reduce the costs and physical footprint required for carbon capture compared with many existing approaches. Carbon Clean’s technology and fully modular construction also aims to reduce site disruption and facilitate faster permitting. “We look forward to partnering with Carbon Clean to help advance Chevron’s pursuit of lower carbon solutions,” said Chris Powers, vice president of Carbon Capture, Utilization, and Storage (CCUS) with Chevron New Energies (CNE). “Chevron has a long history of supporting innovation. We strive to apply our internal capabilities and longstanding partnership approach toward developing and commercializing breakthrough technologies, including those that enable lower carbon solutions in the marketplace.”
Modern Mobility
Hertz Expands Investments in the ‘Modern Mobility Ecosystem’
https://www.pymnts.com/earnings/2022/hertz-expands-investments-in-the-modern-mobility-ecosystem/
With its recent investment in an all-digital, all-electric car rental service, Hertz Global Holdings is continuing its efforts to position itself at the center of the “modern mobility ecosystem,” company executives said Wednesday (Feb. 23) during the company’s quarterly earnings call. They also provided updates on other elements of the company’s plan to invest in technology, electrification, shared mobility and a digital-first customer experience, including Hertz’s partnerships with Tesla, Uber and Carvana that were announced in October. “Bottom line, we have a view of where mobility is headed, and we’re very excited on executing on a strategy to put us firmly in the middle of that,” Hertz Interim CEO Mark Fields said during the call. The new investment in UFODRIVE, a self-service electric vehicle rental company in Europe, will enable Hertz to deploy that company’s digital rental and fleet management technology in the U.S. and Europe, Hertz said in a Feb. 15&nbsp;press release.
Siemens Unveils Easy-To-Deploy, Sustainable EV-Charging Concept
https://eandt.theiet.org/content/articles/2022/02/siemens-unveils-easy-to-deploy-sustainable-ev-charging-concept/
The industry-first sustainable charging solution enables quick installation at scale and easy expansion and maintenance to help meet the growing demand for EV-charging infrastructure, the company claims. The new VersiCharge XL concept (UL standard) was created to electrify new or existing parking lots and building structures quickly and efficiently by using a modular, scalable design made in partnership with Nexii Building Solutions using their proprietary, sustainable building material with low-carbon footprint. The solution, which resembles a modern-day fueling station, was developed in late 2021 and installed in only three days at Siemens’ research and development hub for Electrical Products and eMobility solutions in Peachtree Corners, Georgia, USA. The product was rapidly developed and co-patented with Nexii, a green construction technology company, and is the industry’s first EV-charging system to house all necessary electrical infrastructure components that power EV (electric vehicle) chargers in an above-ground, enclosed, low-carbon structure.
Smart Buildings
Movandi Collaborates With Qualcomm to Expand 5G mmWave Adoption
https://www.kulr8.com/news/money/movandi-collaborates-with-qualcomm-to-expand-5g-mmwave-adoption/article_75bb977f-544b-5091-98ff-b2ff2005b9ad.html
Movandi, a leader in 5G millimeter-wave (mmWave) RF technologies and software, today announced that it has plans to collaborate with&nbsp;Qualcomm Technologies, Inc.&nbsp;to expand the adoption of 5G mmWave deployment for indoor and outdoor scenarios. Both companies are strong proponents of 5G mmWave, and the combination of mmWave small cells powered by Qualcomm® FSM™ 5G RAN Platforms and Movandi-powered 5G smart repeaters will entail expanded 5G mmWave adoption and an increased flexibility in operator deployments. Movandi opens Mobile World Congress in Barcelona with Qualcomm collaboration to expand 5G mmWave adoption. Mobile World Congress in Barcelona, the world’s most influential connectivity industry event where leading companies and trailblazers share the latest thought leadership about the future of connectivity. This combination of small cells based on Qualcomm FSM 5G RAN Platforms and&nbsp;Movandi-powered 5G BeamXR smart repeaters&nbsp;is positioned to offer mobile operators cost-effective and fast deployment of mmWave at scale and help unlock the full potential of 5G.
Industrial ClimateTech
Bill Gates and Chris Sacca Invest in Energy Storage Start-up Antora to Help Heavy Industry Go Green
https://www.cnbc.com/2022/02/16/bill-gates-chris-sacca-invest-50-million-in-antora-energy.html
Decarbonization at the scale necessary to meet global warming mitigation targets will require a radical rethinking of global infrastructure. Heavy industry is a large and often overlooked piece of the puzzle. Gates, through investing arm Breakthrough Energy Ventures, is now backing a start-up that’s at the very early stages of addressing the problem through technology. Founded in 2018,&nbsp;Antora Energy&nbsp;takes zero emissions energy from renewable energy sources, like wind and solar farms, and converts that to heat, which it stores in solid carbon blocks that are insulated in a kind of thermal battery. From there, the stored energy is used as heat in industrial processes needed to make materials like cement and steel, or it’s converted into electricity. The Antora thermal battery is meant to replace a natural gas boiler and will be similar in size to a small house or a large truck trailer. If Antora is successful, it will be selling to large industrial companies, providing a zero-emissions alternative at a lower price.
DOE Announces $150 Million to Reduce Climate Impacts of Energy Technologies and Manufacturing
https://www.energy.gov/articles/doe-announces-150-million-reduce-climate-impacts-energy-technologies-and-manufacturing
The U.S. Department of Energy (DOE) today announced $150 million in open funding for research projects focused on increasing efficiency and curbing carbon emissions from energy technologies and manufacturing. This funding will support research underpinning DOE's&nbsp;Energy Earthshots Initiatives, which set goals for significant improvements in clean energy technology within a decade, including hydrogen, long duration storage, and carbon capture and sequestration. This research is fundamental to the climate solutions that will be critical to reaching President Biden’s goal of net zero carbon emissions by 2050. “Rapidly deploying existing climate technology while cranking up investments in early-stage climate research is the one-two punch we need to build long-term resilience to the climate crisis and meet our 2050 goals,” said&nbsp;U.S. Secretary of Energy Jennifer M. Granholm. “From discovery to deployment, this research funding will draw on the talent of American colleges and universities to expedite the development of new technology that, paired with our current arsenal of climate solutions, will be key to tackling the climate crisis while creating good-paying jobs and bolstering American competitiveness.” Funding will support an array of research topics in basic chemical and materials research, including new clean energy approaches that are inspired by energy-efficient biological processes, such as photosynthesis that harnesses sunlight to synthesize the molecules plants need for life. This research is foundational to the development of solar and nuclear energy technologies, energy storage, carbon capture, novel manufacturing processes, and the use of critical minerals in energy technologies and manufacturing. This funding will also support research underpinning DOE’s Energy Earthshots Initiatives, including the Hydrogen Shot, which aims to decrease the cost of producing hydrogen; the Long Duration Storage Shot, which seeks to reduce the cost and increase the duration of grid-scale energy storage; and the Carbon Negative Shot, which targets the decrease of costs to remove and durably store carbon dioxide from the atmosphere.
WTR SUSTAINABLE INDEX CONSTITUENTS
Figure 20: Energy Technology Comp Table


Source: Thomson Reuters
Figure 21: Modern Mobility Comp Table


Source: Thomson Reuters
Figure 22: Industrial ClimateTech Comp Table

Source: Thomson Reuters
Figure 23: Industrial Cleantech Comp Table


Source: Thomson Reuters
DISCLOSURES
Water Tower Research (“WTR”) is a professional publisher of investment research reports on public companies and, to a lesser extent, private firms (“the Companies”). WTR provides investor-focused content and digital distribution strategies designed to help companies communicate with investors.  WTR is not a registered investment adviser or a broker/dealer nor does WTR provide investment banking services. WTR operates as an exempt investment adviser under the so called “publishers’ exemption” from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940. WTR does not provide investment ratings / recommendations or price targets on the companies it reports on. Readers are advised that the research reports are published and provided solely for informational purposes and should not be construed as an offer to sell or the solicitation of an offer to buy securities or the rendering of investment advice. The information provided in this report should not be construed in any manner whatsoever as personalized advice. All users and readers of WTR’s reports are cautioned to consult their own independent financial, tax and legal advisors prior to purchasing or selling securities.  Shawn Severson, who is the writer of this report, covers the BioEconomy, Emerging Growth &amp; Special Situations and ClimateTech &amp; Sustainable Investing sectors for WTR. Mr. Severson and members of his household have no personal or business-related relationship to the subject company other than providing digital content and any ancillary services WTR may offer.  Unless otherwise indicated, WTR intends to provide continuing coverage of the covered companies. WTR will notify its readers through website postings or other appropriate means if WTR determines to terminate coverage of any of the companies covered.  WTR is being compensated for its research by the company which is the subject of this report. WTR receives no more than a maximum of $10,500 per month from a given client and is required to have at least a 6-month commitment. None of the earned fees are contingent on, and WTR’s client agreements are not cancellable for the content of its reports. WTR does not accept any compensation in the form of warrants or stock options or other equity instruments that could increase in value based on positive coverage in its reports.  WTR or an affiliate may seek to receive compensation for non-research services to covered companies, such as charges for presenting at sponsored investor conferences, distributing press releases, advising on investor relations and broader corporate communications and public relations strategies as well as performing certain other related services (“Ancillary Services”). The companies that WTR covers in our research are not required to purchase or use Ancillary Services that WTR or an affiliate might offer to clients.  The manner of WTR’s research compensation and Ancillary Services to covered companies raise actual and perceived conflicts of interest. WTR is committed to manage those conflicts to protect its reputation and the objectivity of employees/analysts by adhering to strictly-written compliance guidelines.  The views and analyses included in our research reports are based on current public information that we consider to be reliable, but no representation or warranty, expressed or implied, is made as to their accuracy, completeness, timeliness, or correctness. Neither we nor our analysts, directors, officers, employees, representatives, independent contractors, agents or affiliate shall be liable for any omissions, errors or inaccuracies, regardless of cause, foreseeability or the lack of timeliness of, or any delay or interruptions in the transmission of our reports to content users. This lack of liability extends to direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees, losses, lost income, lost profit or opportunity costs.  All investment information contained herein should be independently verified by the reader or user of this report. For additional information, all readers of this report are encouraged to visit WTR’s website www.watertowerresearch.com.

Weekly Sustainable Investing Surveyor: Week Ended February 25, 2022

Weekly Sustainable Investing Surveyor: Week Ended February 18, 2022

Canada

Westport Fuel Systems Inc. produces natural gas engines and fuel system components for on and off-highway commercial vehicles, as well as passenger automobiles. Westport is commercializing high pressure direct injection (HPDI) combustion technology.

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Westport Fuel Systems (WPRT US)

Weekly Sustainable Investing Surveyor: Week Ended February 25, 2022

SUMMARY Last Week’s Events SES AI Corp. (SES) Fireside chat with CEO Dr. Qichao Hu who provided an overview of SES’s strategic initiatives and...

Water Tower Research

Weekly Sustainable Investing Surveyor: Week Ended February 18, 2022

SUMMARY Upcoming Events SES AI Corp (SES) Fireside Chat: SES CEO Dr. Qichao Hu to Provide an Overview of Strategic Initiatives and Technology...

Water Tower Research

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