Last Updated: 10 Nov 2024
Executive Summary
ESS Tech Inc. (GWH) is a developer and marketer of iron flow batteries for utility and commercial energy storage needs. Despite strong revenue growth, the company continues to face profitability challenges, with negative EBITDA and EPS. Analysts maintain a mixed outlook on the stock, with some expecting a strong buy and others recommending a hold. The current stock price of $8.27 is within the 52-week range and below the analyst target price of $18.57.
Company Overview
ESS Inc. is headquartered in Wilsonville, Oregon, and has a market capitalization of $98.165 million. The company's iron flow batteries are designed for long-duration energy storage, making them suitable for grid-scale applications. ESS has a global presence, with customers in various countries.
Fundamental Analysis
Revenue: ESS reported revenue of $7.427 million for the trailing twelve months (TTM), representing a decline of 0.877% year-over-year.
Profitability: The company continues to operate at a loss, with negative EBITDA of -$72.889 million and diluted EPS of -$6.30.
Margins: ESS's profit and operating margins remain negative, at 0% and -66.45%, respectively.
Return on Assets and Equity: The company's return on assets and equity are also negative, indicating that it is not generating sufficient returns on its investments.
Book Value: The company's book value per share is $5.86.
Technical Analysis
Price Action: The stock price is currently trading at $8.27, within the 52-week range of $5.20 to $21.15.
Moving Averages: The 50-day moving average is $6.98, while the 200-day moving average is $10.39.
Beta: The stock's beta is 1.414, indicating that it is more volatile than the overall market.
Short Term Outlook
Analysts are cautiously optimistic about ESS's short-term prospects. The company's revenue growth is encouraging, but its profitability challenges remain a concern. The stock price is currently below the analyst target price, suggesting that there may be some upside potential in the near term. However, investors should be aware of the risks associated with investing in a company that is still operating at a loss.
Long Term Outlook
The long-term outlook for ESS is more uncertain. The company's iron flow battery technology has the potential to be a disruptive force in the energy storage market. However, the company faces significant competition and needs to demonstrate that it can scale its operations and achieve profitability. Investors should monitor the company's progress closely and consider the long-term potential of its technology before making an investment decision.
Analyst Recommendations
Analysts have a mixed outlook on ESS Tech Inc. Two analysts recommend a strong buy, two recommend a buy, and three recommend a hold. No analysts recommend a sell or strong sell. The average analyst target price is $18.57, which represents a significant premium to the current stock price.
