Hi Jancy,
Xebec is another one that looks attractive based on the industry it operates. Much like GRN, it is well positioned to benefit from increased investments from governments and companies as they strive to reduce carbon emissions. Xebec is focused on Renewable Natural Gas and Renewable Hydrogen (which is a slight differentiator over GRN). It claims to be the world's only focused Renewable Gas company that exposure to both RNG and RH. Over its lifetime, it has deployed 65 RNG and 200 RH projects worldwide.
The company is also growing revenue at a rapid pace. Between 2017 and 2019, Revenue more than tripled from $14.7M to $49.3M. It expects to exit 2020 with ~$75M, a 52% jump over 2019. It also has about $88M in backlog. The company has also been EBITDA positive over the past couple of years. In comparison, GRN generated $9.1M in revenue in 2019 and is pace for $22.7M in 2020. It also has a backlog of $43M which represents growth of 350% YoY. Based on expected fiscal revenue, XBC is generating ~ double the revenue of GRN.
XBC however, with a market cap of $636M vs $113M for GRN is trading at much higher valuation. It has a forward P/S ratio of 5.04 versus 2.69 for GRN. Given it is a larger player than GRN, it commands more attention from the markets and as such, is likely the reason for its premium. Recently however, that gap has narrowed. I'd expect it to narrow further as GRN continues to establish itself. Of note, both have similar growth rates with XBC and GRN expected to grow revenue by 70% and 84% respectively in 2021.
Overall, I like both companies and there is certainly room for many companies in this space. The market for renewable gases i significant. The main differentiator between GRN and XBC, is the fact that XBC is more diversified with its exposure to Hydrogen. Also of note, XBC is expected to graduate to the main TSX Index which will also increase its attractiveness to the broader market.
Mat