Price Target Increase for EnWave Corp After Excellent Second Quarter
EnWave Corporation (TSXV:ENW – $0.85 CAD & OTC:NWVCF – $0.65 USD), which offers industrial-scale dehydration technology for commercial applications in the food and pharmaceutical spaces more than doubled its revenues in its second quarter of 2016 and achieved positive net income for the first time in its history.
Several companies, such as Natural Nutrition and Ereğli Agrosan, have recently purchased their second REV dryer. Other companies, such as Milne Fruit Products, NutraDried LLP, and Bonduelle are ramping up production to meet demand for their dried products. Moreover, dozens of companies in a variety of industries are currently evaluating EnWave’s REV technology. Consequently, we expect to see a continued flow of new Technology Evaluation and Royalty-Bearing agreements being announced in the following months.
Sutro Biopharma, a pharmaceutical company based in San Francisco, is scheduled to receive a commercial scale powderREV machine in the first half of 2016. Commercial production will begin immediately after the testing phase is complete, contingent on the viability of their pharmaceutical products.
Commenting on this upcoming event in a recent interview with Smallcaps Investment Research, Brent Charleton said, “I think that the Sutro Biopharma relationship is the “dark horse” in our investment case. If successful, their throughput capacity will press the need for additional machinery. I think that this is an area that could surprise a lot of people this year”.
With ever more national and international entities becoming aware of EnWave’s superior technology, the Company’s negotiating position is getting much stronger. The agreement with Natural Nutrition, for example, immediately included a minimum of three machine sales in order for the company to retain their exclusivity rights. And the deal with Ereğli Agrosan even included a total of four potential machine sales. This strategy may become EnWave’s blueprint for future agreements.
We reiterate our buy recommendation for EnWave Corp. with a price target of $3.49, which is 310% above today’s stock price.
|Download the second quarter 2016 EnWave Corp. Company Report.|
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