Investing

Earnings Previews: ESS Tech, Payoneer, Rivian, Toast 

The company’s iron flow batteries are directed at the market for long-duration storage of electricity generated from wind and solar. Compared to lithium-ion batteries, the materials used in ESS batteries are cheaper, abundant and safer. If approved by the House and signed by President Biden, the Senate-passed Inflation Reduction Act will pump some $40 billion into promoting clean energy projects through production and investment tax credits.

Of six brokerages covering the stock, analysts are evenly split between Buy and Hold ratings. At a recent share price of around $4.10, the implied upside based on a median price target of $7.00 is 70.1%. At the high target of $23.00, the upside potential is 126.6%.

Second-quarter revenue is forecast at $380,000. The company is expected to post an adjusted loss per share of $0.15, compared to a loss of $0.04 in the prior quarter and $10.31 per share in the year-ago quarter. For the 2022 fiscal year, the forecast calls for a loss per share of $0.51, compared to last year’s loss of $5.73, on revenue of $3.73 million, compared to no revenue in the prior year.

ESS is not expected to post a profit until 2024. The enterprise value to sales multiple is 111.8 for 2022, dropping to 3.2 in 2023 and 1.1 in 2024. The stock’s 52-week range is $2.59 to $28.92. The company does not pay a dividend, and the total shareholder return since the public launch was negative 59.6%.

Payoneer

Payoneer Global Inc. (NASDAQ: PAYO) provides an integrated digital payments platform that allows, among other things, cross-border payments. The stock’s share price has dropped by just over 45% over the past 12 months, but since reaching a 52-week low in mid-May, shares have bounced up by more than 50%. For the first six weeks of the current quarter, the stock is up nearly 40%. Payoneer is working on a way to automate business-to-business transactions, a category of payments that remains largely manual.

Of seven brokerages covering the stock, all have Buy or Strong Buy ratings. At a share price of around $5.50, the implied upside based on a median price target of $7.00 is 27.3%. At the high target of $9.00, the upside potential is 63.6%.

Second-quarter revenue is forecast at $131.48 million, which would be down 4.0% sequentially but up 19.3% year over year. The company is expected to post an adjusted loss per share of $0.04, compared to a loss of $0.03 in the prior quarter and $0.75 per share in the year-ago quarter. For the 2022 fiscal year, the company is forecast to post a loss per share of $0.12, compared to last year’s loss of $0.21, on revenue of $563.12 million, up 19%.

Payoneer is not expected to post a profit in 2022 or 2023. The enterprise value to sales multiple is 2.6 for 2022, dropping to 2.2 in 2023. The stock’s 52-week range is $3.33 to $10.84. The company does not pay a dividend, and the total shareholder return for the past year was negative 45.2%.

Rivian

Since its initial public offering in early November of last year, shares of Rivian Automotive Inc. (NASDAQ: RIVN) soared to a gain of nearly 120%, before dropping to down 80% in mid-May. Since mid-May, however, shares have bounced up 78%.

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