Hi there,
Just answered a question on EXRO last week. Here was my response:
-------------------
Hi there,
The company shot up recently as it announced a firm order for 2,000 coil drivers with LAND. Why is this important, because it is likely the start of the company's transition to proving its technology, to proving its business model. The company has not yet reported any revenue, but the first drivers are expected to be delivered in February of this year.
It has signed 8 commercial deals in 2020, but this is the first time it has specified units and is the first clear indication that commercialization is underway. Of those 8 deals, the first is expected to contribute to revenue in the second quarter of 2021 - so that should be two deals now that will have a financial impact in the first half of the year as this new deal is over and above the 8 signed previously.
The 2nd and 3rd commercial deals are expected to start contribution in Q3 and Q4 of 2021. Tally it all up, and it is likely EXRO will see a new commercial deal added every quarter so in theory revenue should jump accordingly. Ultimately, the company's roadmap calls for positive EBITDA in the second half of 2023.
Bottom line - the next few quarters will be exciting as investors will finally et an idea as to what commercialization looks like in terms of $$$.
----------------------------------
In other words, it is on the right track and it will be interesting to see how they can turn their concepts into a proven business model. I'd exercise caution here as it is a company that is now trading at a market cap of almost $900M with no reported revenues to day. Steep price to pay for unknowns. I quite like the company and its products certainly have potential, the question is what price in an investor willing to pay.
Personally, i'd like a little more clarity on what these deals mean in terms of revenue. Of note, analysts are only expecting $1.2M in revenue in fiscal 2021 (2.4 on the high end) - that seems very low and if that is all they report this year, than, it would not be a price i'd be willing to pay.
Mat