Price Target Increase for EnWave After Outstanding Financial Progress
Until recently, food processing companies had to choose between minimizing their drying costs or producing premium dried products. Thanks to EnWave Corporation’s (TSXV:ENW – $1.00 CAD & OTC:NWVCF – $0.84 USD) Radiant Energy Vacuum (REV) technology, companies no longer have to choose, as they’re able to produce high-value dried products at a much lower cost.
More and more companies are benefitting from this technology and as a result, in the second quarter, ended March 31, 2015, EnWave, for the first time in its history, reported a net income (including foreign exchange translation). Sales for the quarter were $5.4 million, up more than tenfold compared with the same period last year. Income for the quarter was $23,552 versus a loss of $2,177,847 in the second quarter of fiscal year 2014. And it certainly doesn’t stop there.
During the past few weeks, EnWave started up three commercial REV machines that will soon generate royalties. The first unit was installed at Umland LLC, which sells high kosher cheese snacks, the second at Gay Lea, the second largest dairy co-operative in Canada and the third one at Natural Nutrition, a Chilean fruit processor.
At Bonduelle, a global leader in the production of vegetables, a 120kW quantaREV commercial unit is scheduled to come online very shortly. This will generate an attractive production-based royalty for EnWave. If successful, several more units could be ordered by Bonduelle.
A 100kW commercial nutraREV unit is being installed at Hormel Foods Corporation, a multinational manufacturer and marketer of high-quality, brand-name food and meat products. Once operational, royalties should vary between $200,000 and $400,000 per year at full utilization.
Moreover, the long awaited launch of Cheddar and Gouda Moon Cheese snacks, as part of a sixteen week long trial program at 3,500 locations of a major coffee chain in the United States is set to begin later this month.
As a result of all these positive developments, we have increased the price target for EnWave’s shares to $3.15, up 13% compared to our previous report.
| Download the second quarter 2015 EnWave Corp. Company Report. |  |
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How many of your recommendations meet or exceed your price targets?
Hi Buhlz_I,
The best way to reply to your question is refer you to our Track Record, which lists all our recommendations since we started the website in 2003. So far we have recommended 144 stocks and most of them have performed well. Of course, every now and then you’ll find one that hasn’t performed as expected, but overall we’re very pleased.
Cheers
Is there any indication how the enzyme research/production is going?
Hi Scott,
What exactly do you mean? Are you referring to the powderREV technology in general, or do you have specific agreements/licenses in mind?
I’m referring to this news release dated Feb 18th, 2014:
EnWave Corporation (TSX-V:ENW | FSE:E4U) (“EnWave”, or the “Company”) announced today that
the Company has initiated the transfer of a commercial-scale powderREV® machine (the “Machinery”) to
the major North American enzyme producer (the “Enzyme Producer”) who signed a royalty-bearing
commercial license to use Radiant Energy Vacuum (“REV™”) technology in April 2013. Prior to the
initiation of the transfer, EnWave completed successful in-house dehydration trials for several enzyme
solutions.
EnWave will now begin installation of the machine at the Enzyme Producer’s site in preparation for initial
testing to begin toward the beginning of April. Complications relating to the Enzyme Producer’s site
preparation delayed the timing of the delivery and the customer verification work which needs to be
completed with their established Tier 1 customers prior to commercialization. If the customer verification
is successful the Enzyme Producer and EnWave have now targeted the second half of 2014 for
commercial start-up of the Machinery. The Enzyme Producer is expected to produce several dehydrated
enzymes used in a number of food related applications and has secured an option for another enzyme
category should the technology successfully meet commercial targets.
I haven’t heard of any updates regarding this news release and I no longer see mention of this listed in their corporate presentation.
Scott,
The “enzyme partner” is still listed in EnWave’s most recent Corporate Presentation under commercial agreements (slide 21). But you’re correct that there hasn’t been any recent news about it.
So we’ll ask the Company’s management. We have a new interview scheduled and we’ll make sure to include a question about it.
Thank you for pointing it out.