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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.

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<h2>KEY POINTS</h2>
<ul>
<li>EVmo reported 2021 revenues of $10.2 million, up 34% from 2020. Net loss of $15 million increased from 2020 due to higher interest expenses and professional/legal costs. Management stated on the call that most of the Y/Y increase in net loss was due to non-recurring and non-operational costs. Complete results can be accessed&nbsp;<a href="https://evmo.com/?page_id=3460" target="_blank" rel="noopener">here</a>.</li>
<li>Foundation for growth now in place.&nbsp;2022 will be the first full year with the new management team at the helm. 2H21 and early 2022 saw the team take several actions to stabilize the company and position it for the future. These include securing new debt facilities to acquire vehicles, an equity raise, and numerous hires and new processes implemented to improve vehicle utilization, maintenance efficiencies, as well as the overall user experience.</li>
<li>Management sets 2022 revenue guidance of $18.2-$19.4 million&nbsp;with gross margins of 36-40% before vehicle depreciation. This is the first time the company has issued any financial guidance.</li>
<li>Targeting 2,000+ vehicles by YE22, up from ~600 vehicles in the fleet at YE21. The company reiterated its goal of having more than 2,000 vehicles in its fleet by YE22, noting that, with its recent financial partnerships and strengthened balance sheet, it now has the ability to add more than 400 vehicles per quarter.</li>
<li>Insiders now own 17.7% of the shares. Executive Chairman Terren Peizer purchased 2.43 million shares in early March 2022 and stated on the call his willingness to buy more.</li>
<li>Shares trading at less than 2X 2022 sales. Taking the low-end of 2022 revenue guidance ($18.2 million) and 69.5 million shares outstanding (per the 10-K), shares are trading at just 1.7X price-to-sales.</li>
<li>Balance sheet strengthened by January 2022 capital raise. EVmo raised $13.7 million in a January 2022 equity raise at $0.50/share, which is supporting the acquisition of new cars and will allow the company to grow and scale it business nationwide.</li>
</ul>
<h2>COMPANY OVERVIEW</h2>
<p>EVmo is a leading play on the rapidly growing rideshare and gig-delivery economies. The company bridges the gap between rideshare and "last mile" delivery drivers in need of suitable vehicles through an online vehicle booking and management system for both its owned and maintained vehicles as well as to third-party fleets.</p>
<p>The company was founded in 2016 and is headquartered in Los Angeles, CA. For more information, please go to&nbsp;www.evmo.com.</p>
<h2>DISCLOSURES</h2>
<p>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.<br><br>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.<br><br>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.<br><br>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.<br><br>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.<br><br>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.<br><br>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.<br><br>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.<br><br>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.</p>

KEY POINTS

EVmo reported 2021 revenues of $10.2 million, up 34% from 2020. Net loss of $15 million increased from 2020 due to higher interest expenses and professional/legal costs. Management stated on the call that most of the Y/Y increase in net loss was due to non-recurring and non-operational costs. Complete results can be accessed&nbsp;here.
Foundation for growth now in place.&nbsp;2022 will be the first full year with the new management team at the helm. 2H21 and early 2022 saw the team take several actions to stabilize the company and position it for the future. These include securing new debt facilities to acquire vehicles, an equity raise, and numerous hires and new processes implemented to improve vehicle utilization, maintenance efficiencies, as well as the overall user experience.
Management sets 2022 revenue guidance of $18.2-$19.4 million&nbsp;with gross margins of 36-40% before vehicle depreciation. This is the first time the company has issued any financial guidance.
Targeting 2,000+ vehicles by YE22, up from ~600 vehicles in the fleet at YE21. The company reiterated its goal of having more than 2,000 vehicles in its fleet by YE22, noting that, with its recent financial partnerships and strengthened balance sheet, it now has the ability to add more than 400 vehicles per quarter.
Insiders now own 17.7% of the shares. Executive Chairman Terren Peizer purchased 2.43 million shares in early March 2022 and stated on the call his willingness to buy more.
Shares trading at less than 2X 2022 sales. Taking the low-end of 2022 revenue guidance ($18.2 million) and 69.5 million shares outstanding (per the 10-K), shares are trading at just 1.7X price-to-sales.
Balance sheet strengthened by January 2022 capital raise. EVmo raised $13.7 million in a January 2022 equity raise at $0.50/share, which is supporting the acquisition of new cars and will allow the company to grow and scale it business nationwide.

COMPANY OVERVIEW
EVmo is a leading play on the rapidly growing rideshare and gig-delivery economies. The company bridges the gap between rideshare and "last mile" delivery drivers in need of suitable vehicles through an online vehicle booking and management system for both its owned and maintained vehicles as well as to third-party fleets.
The company was founded in 2016 and is headquartered in Los Angeles, CA. For more information, please go to&nbsp;www.evmo.com.
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.

Ear-End Results Set Stage for Rapid Growth in 2022 and Beyond