Craig-Hallum downgrades PureCycle Technologies to Hold, cuts price target to $4

As previously reported, Craig-Hallum downgraded PureCycle Technologies to Hold from Buy with a price target of $4, down from $7. PureCycle has proven that its proprietary polypropylene purification technology works, but now it must prove that the technology can produce recycled PP pellets at scale rather than it simply being an unsuccessful science project, the firm argues. In December, PureCycle announced the resumption of Ironton production followed closely by the disclosure on December 18th that certain mechanical problems had occurred with maintenance underway to a block valve and a faulty seal. All in all, this meant that the company would not meet its December 31 bondholder operational milestone and would utilize its 90-day cure period, Craig-Hallum notes. While PureCycle has taken steps on the cost side to deal with its current situation, the reality is that it remains all about Ironton, the firm adds.