Analyst Thomas Boyes of TD Cowen maintained a Buy rating on Energy Vault Holdings (NRGV – Research Report), with a price target of $2.00.
Thomas Boyes has given his Buy rating due to a combination of factors that highlight both the challenges and potential growth opportunities for Energy Vault Holdings. Despite the company’s FY24 results falling short of expectations due to lower lithium-ion battery prices and timing issues with gravity license revenue, the substantial backlog of $660 million, which represents a 90% increase from the previous quarter, showcases strong booking progress. This backlog includes significant projects like the 1GWh Stoney Creek project, which comes with a long-term service agreement, indicating a stable future revenue stream.
Moreover, Energy Vault’s strategic shift towards its ‘Own & Operate’ model is expected to yield long-term recurring revenue, with a portfolio of 840MW of projects poised to generate approximately $2 billion. Although FY25 guidance was revised downwards due to continued pricing pressures and strategic shifts, the potential for higher gross margins and the possibility of demand being pulled forward into FY25 due to tariff concerns provide a positive outlook. These factors, combined with the company’s ability to adapt and capitalize on its strategic initiatives, underpin Boyes’s Buy rating.
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