LOOP Energy Prices Its IPO at the High End of Expectations

Posted on February 19, 2021 by Mathieu Litalien

LOOP Energy (LPEN) filed its final long-form prospectus in which it priced its offering at $16.00 per share - at the high end of expectations. Upon closing of the IPO, Loop Energy will have 33,577,961 common shares or 34,515,461 common shares issued and outstanding if the over-allotment option is exercised in full.

The strong demand is as we expected and it gives the company a value of approximately $552M assuming the full over-allotment is exercised. The company expects to list on the TSX Index, on or before February 25, 2021. 

The company's current backlog stands at $16.4M and assuming it gets filled over the next year, that gives it a price to forward sales of 33.65. While this is expensive, the company has been growing the backlog quite extensively. In fact, it added ~$13M to that backlog in only a month. The company's backlog is projected sales over the next 24 months (2 years).

It is also not really expensive when you compare it to another fuel cell company like Ballard Power which is trading at 67 times forward sales. Ballard has dropped significantly over the past couple of weeks, but we when we last took a look, it was trading at a forward P/S of 85. LOOP Energy certainly looks cheap in comparison. 

Since this is a very hot industry and one that is likely to garner attention, we will be putting together an IPO Report on this company so stay tuned. 

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Mathieu Litalien

About the author

Mathieu is an individual investor and has been investing part-time for the better part of the past 20 years. He is primarily interested in fundamental analysis, focusing on the long-term and his portfolio is composed primarily of dividend-paying equities. Mathieu has a moderate risk profile and also looks for growth and value. His passion for finance and the markets have led him to his MBA and writing for Seeking Alpha and Stocktrades. Mathieu also focuses primarily on stock research and content production for Stocktrades.ca Premium and the Stocktrades blog.