The technology industry has been grappling with challenges on several fronts, including supply chain disruption and an industry-wide labor shortage. However, the sector has witnessed heightened demand for tech solutions amid the global digitization and automation trends. According to IDC, the industry is returning to its previous growth pattern of 5%-6% growth year-over-year. Also, IDC forecasts that the technology industry is on pace to exceed $5.30 trillion in 2022.
“We believe that we are entering a new environment where the influence of technology is rapidly broadening to impact virtually every industry,” observed Peter Oppenheimer, chief global equity strategist at Goldman Sachs. With the uptake of technology increasing across businesses, tech investment is expected to continue growing, helping the industry thrive.
Although the market has soured on tech stocks lately due to concerns surrounding the anticipated interest rate hikes, Wall Street analysts see a 100% or more upside potential in tech stocks, FTC Solar, Inc. (FTCI), GreenBox POS (GBOX), and SPI Energy Co., Ltd. (SPI), which are currently trading at less than $5.
FTC Solar, Inc. (FTCI)
FTCI in Austin, Tex., provides solar tracker systems, technology, software, and engineering services. It offers two-panel in-portrait single-axis tracker solutions under the Voyager brand name, and SunPath, a software solution to enhance energy production, among others in its portfolio.
This month, FTCI was awarded a contract from leading Australian energy infrastructure business APA Group to supply FTCI’s 2P Voyager tracker to ensure efficiency on APA’s new 88 MW solar project in Mica Creek, QLD Australia. This will mark FTCI’s largest project to date outside of the U.S. and should help the company strengthen its position in the global market.
Last November, the company was awarded a 504 megawatts DC project in Arizona to provide its Voyager tracker to Moss Solar, one of the nation’s leading Engineering, Procurement, and Construction (EPC) companies, which has been contracted by a leading Tier 1 U.S. Developer to construct the solar plus storage facility. Also, FTCI was awarded its first project in Africa in the same month. These projects should add significantly to the company’s revenues in the near term.
For the nine months ended Sept. 30, 2021, FTCI’s total revenues increased 17.9% year-over-year to $168.80 million. Its product revenues stood at $137.80 million, up 12.8% from its year-ago value, while its service revenues were up 47.8% from the same period the prior year to $31 million. In addition, the company’s cash and restricted cash balance came in at $140.66 million, indicating a 590.8% increase year-over-year.
The $434.39 million consensus revenue estimate for its fiscal year 2022 indicates an 80% increase year-over-year. The Street expects the company’s EPS to improve 95% year-over-year. Over the past month, the stock has slumped 12.4% in price to close yesterday’s trading session at $3.60. The 12-month median price target of $7.20 indicates a potential 100% upside.
GreenBox POS (GBOX)
GBOX is a San Diego, Calif-based technology company that develops, markets, and sells blockchain-based payment solutions. Its blockchain-based systems facilitate, record, and store a volume of tokenized assets that represent cash or data on a blockchain-based ledger.
On February 16, GBOX announced its licensing partnership with Cross River, a respected technology-driven infrastructure provider that offers embedded financial solutions, to make its way toward full banking as a service initiative. “This was an important and necessary first step towards the launch of banking as a service, which we believe will be a game-changer for GreenBox as it will radically expand our capabilities and the vast universe of potential customers, with a customer-inspired, technology-driven, and combined offering,” said Fredi Nisan, Chief Executive Officer of GreenBox POS.
Last month, GBOX announced its agreement to acquire Roark Holdings Ltd, a United Kingdom-based licensed payment institution, in an all-stock transaction for 150,000 shares. This strategic transaction should enable the company to expand its capabilities and footing across multiple markets.
GBOX’s total revenues increased 163.2% year-over-year to $8.05 million in its fiscal third quarter, ended Sept. 30, 2021. Its gross profit rose 364.5% from the prior-year quarter to $5.62 million. Also, for the nine months ended September 30, the cash and cash equivalents balance came in at $29.71 million, reflecting a substantial increase from its year-ago value of $124,834.
The Street expects the company’s revenues to come in at $75.16 million in fiscal 2022, indicating a 159.9% increase year-over-year. The company’s EPS is expected to improve 97.7% year-over-year in the same period.
The stock has slumped 14.5% in price over the past month to close yesterday’s trading session at $3.00. However, the 12-month median price target of $11.92 indicates a 297.3% potential upside.
SPI Energy Co., Ltd. (SPI)
SPI provides photovoltaic solutions for business, residential, government, utility customers, and investors. It also develops, owns, and operates solar projects that sell electricity to power companies and other electricity off-takers. SPI is headquartered in Shanghai, China.
Last week, SPI announced that Solarjuice Technology, the company’s solar manufacturing division, had signed agreements to upgrade its Sacramento, California manufacturing facility with improved technology, to increase the existing solar module manufacturing capacity to 1.1 gigawatts (GW) by the second half of 2022. Earlier this month, SPI announced that its subsidiary SPI Solar Inc. secured approximately 473 acres across three parcels to develop a utility-scale solar project in Maryland. These capacity expansions should benefit the company given the expanding solar market.
In the six months ended June 30, 2021, SPI’s revenue increased 40.8% year-over-year to $79.40 million. Its gross profit grew 138.7% from its year-ago value to $7.40 million. And its cash and cash equivalents stood at $22.80 million in the period.
Shares of SPI have gained 7.4% over the past month to close the last trading session at $2.91. The 12-month median price target of $12.00 indicates a 312.4% potential upside.
FTCI shares were trading at $3.53 per share on Wednesday afternoon, down $0.07 (-1.94%). Year-to-date, FTCI has declined -53.31%, versus a -10.76% rise in the benchmark S&P 500 index during the same period.
About the Author: Subhasree Kar
Subhasree’s keen interest in financial instruments led her to pursue a career as an investment analyst. After earning a Master’s degree in Economics, she gained knowledge of equity research and portfolio management at Finlatics.
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