Demand for Tecogen Products Grows Dramatically Across Multitude of Sectors
Tecogen Inc. (US: TGEN – $2.66 & GER: 2T1 – €2.27) designs, manufactures and sells industrial and commercial CHP (Combined Heat & Power), or cogeneration, systems that produce combinations of electricity, hot water, and air conditioning. It’s a well-established Company that has already shipped over 3,000 units, some of which have been operating for more than 35 years.
The exponential demand growth for cannabis, and the unique regulatory framework that requires cultivation of the plants within each state where the sales are completed, has led to a rapid increase in the construction of new indoor cultivation centers for cannabis plants. The specific requirements necessary for optimal plant yields and the high energy costs associated with many of the states where these facilities are located, has encouraged cannabis growers to purchase integrated systems developed by Tecogen as the ideal solution for their needs.
Moreover, the increasing population density and continued urbanization of the northeastern United States is a gold mine for Tecogen. Building owners will have tremendous incentive to reduce operating costs through a cleaner power footprint by any means necessary. Governments and utilities will want to reduce the strain on the power grid. The demographic factors that make the Company’s Tecochill and microgrid systems must-have products will only get more favorable.
An aging population needs reliable and secure power to their nursing home or medical facility. Data centers will need to be built and kept cool. Cannabis cultivators will continue to grow a newly legal product. And families will want to have well-run sports facilities within their vicinity.
Tecogen management has laid the groundwork for a very successful 2020. Backlog is at record highs and every few weeks the Company announces a new contract that is set to deploy in late 2019 or 2020. These contracts often come with multi-year maintenance agreements and the skating rink deal is no exception.
Tecogen remains an excellent investment for patient and risk-tolerant investors with at least a one year time horizon. Its thinly traded nature makes it a prime candidate for a major run towards our target price on continued positive news or demonstrated profitability and revenue growth.
We reiterate our buy recommendation for Tecogen Inc. with a target price of $9.41, which is 218% above today’s stock price.
Download the second quarter 2019 Tecogen Inc. Company Report.
|Smallcaps.us Advice: Buy||Price Target: $9.41||Latest Company Report (pdf)|
|For important disclosures, please read our disclaimer.|