ESS Tech, Inc. (GWH) on Q4 2021 Results - Earnings Call Transcript
Operator: Ladies and gentlemen, thank you for standing by. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. . I would now like to turn the conference over to Erik Bylin. Please go ahead, sir. Erik Bylin: Welcome to ESS's 20-21 Fourth Quarter Fnancial Results conference call. Joining me on the call today from ESS are Eric Dresselhuys, CEO, and Amir Moftakhar, CFO. Following management's prepared remarks, we will hold a Q&A session. Earlier today, ESS released financial results for the fourth quarter of 2021. This earnings release is available on the Investor Relations section of the company's website. As a reminder, the information presented today will include forward-looking statements, including, without limitation, statements about our growth prospects and strategy for 2022. The forward-looking statements that will be made on this call are based on information currently available to us as of today. These statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those projected or implied during this call. In particular, those described in our risk factors set forth in more detail in our most recent periodic reports filed with the Securities and Exchange Commission, as well as the current uncertainty and unpredictability in our business, the markets, and the economy. You should not rely on forward-looking statements as predictions of future events. All forward-looking statements that we make on this call are based on assumptions and beliefs as of the date hereof. And we disclaim any obligation to update any forward-looking statements, except as required by law. During the call, we will also present certain financial information on a non-GAAP basis. Management believes that non-GAAP financial measures taken in conjunction with U.S. GAAP financial measures provide useful information of the role of management and investors by excluding certain items that are not indicative of our core operating results. Management uses non-GAAP measures internally to understand, manage, and evaluate our business, and make operating decisions. Reconciliations between U.S. GAAP and non-GAAP results are presented within our earnings release. And with that, I will turn the call over to ESS CEO, Eric Dresselhuys. Eric Dresselhuys: Thank you. And welcome to ESS ' first earnings call as a public company. I will start today's call by giving you some context on the market, then share some details on our fourth quarter performance and product deliveries, and then discuss our go-forward plan. After that, I will hand off to Amir to discuss financials and our outlook. 2021 represented an unprecedented transition not only for ESS, but also for long-duration storage. The forecast for long-duration storage at the beginning of the year were dwarfed by those exiting the year, and the momentum is not slowing. It has become abundantly clear that scalable, safe grid storage that last for more than four hours is imperative to moving to a clean energy future. In the past, storage has met lithium-ion because it was the only available technology. Now with continued proliferation of intermittent renewables, like solar and wind, the need for storage that can discharge over 6, 8 and even 12 hours has become imperative. The acceleration of storage installations supporting longer durations and more varied operating environments and use cases is the catalyst for the industry to move from legacy technologies to those tailor-mades for these applications. And it's easy to find evidence of this transition in the news on a regular basis. Just last month, California dedicated $380 million to support long-duration energy storage projects over its next two fiscal years. These funds are targeted to support grid reliability, adding resilience against emergencies such as wildfires. Certainly applications lithium-ion is not suited for. Our project with San Diego Gas and Electric is a great example of this coming to life. Long-duration storage paired with renewable generation to provide resiliency to critical infrastructure, while also helping to safely decarbonize the grid. In November, the newly formed Long-Duration Energy Storage Council, released a study with McKinsey delineating the needs for long-duration energy storage, focusing on the need for storage that can discharge for more than eight hours. Among the findings, the authors concluded that by 2040, LDES needs to be scaled up to 400 times present day levels, to between 85TWh and 140TWh of capacity, which would require between $1.5 and $3 trillion in investment. Leading companies such as Microsoft, Google, Shell, Rio Tinto, and dozens of others have joined the council, highlighting the importance these large energy users and producers plays on long-duration storage and its place in driving the energy transition. Finally, earlier this month, the State of California approved plans to add over 25 gigawatts of renewables and 15 gigawatts of storage by 2032, effectively raising the state's renewable portfolio to 73%. But this is not some promise land off in a distant future. The inbound inquiries we receive continue to rise, and the quality of the opportunities behind those inquiries is improving as well. These are organizations that know that the future entails a move away from lithium-ion. And although we have only recently begun to build our sales and marketing efforts, we already have direct visibility, through customer relationships into vast opportunities that have grown almost exclusively from inbound inquiries. There's an undeniable need to solve for long-duration storage. And while the flood of LDS demand has brought new technologies into the fray, we remain confident that we have the best solution across cost, reliability, safety, environmental friendliness, that can be deployed in the market today and comes with UL Certification for battery modules, energy storage systems, and fire safety. We believe the design work that got us to this point was ingenious. Our iron flow battery technology is relatively simple to build, reliable, and has at its core very inexpensive input components for a grid storage system: iron, salt, and water. ESS separates the power from the capacity, which makes us even more economical at longer durations. With zero capacity fade over 20,000 cycles, our technology carries the additional benefit of being environmentally sustainable and non-flammable. Moving on to our fourth quarter results. While we did not recognize revenue in Q4, we were able to make material progress with customer deliveries, new sales, and ramping our operations. We began shipping our second-generation energy warehouses in the third quarter of 2021, and the first units were delivered to three separate customers and installed in the fourth quarter of 2021. However, these were our first commercial units to ship, so our revenue recognition process will be slow and deliberate. Initially, revenue recognition will be deferred until customer acceptance has been received for each unit, or until we establish a history of successfully obtaining acceptance from customers. In the near-term, as our products are new, this is likely to be a longer process than when our products are more mature and we have more history with customer acceptance. We expect to improve our process for recognizing revenue more quickly in the future. We've learned a lot about how to accelerate our testing, prepare the customer sites in advance, and be more efficient in our startup. These learnings will help us bring up customers ' applications more quickly; not only so that we can recognize revenue, but also so that the customers can receive the remarkable value of our solutions even faster. While we feel fortunate that the groundswell that has brought long-duration energy storage to the forefront, just as ESS has moved to scale production, that timing has also coincided with unprecedented supply chain challenges, that have slowed our initial shipments at Energy Warehouse’s. As examples, we faced limitations with some injected molded parts, as well as challenges securing certain electronic components. We're in the process of working through each of these. We are broadening and strengthening our supply base and redesigning PCBs to leverage more widely available components. Importantly however, we see these as short-term constraints. In the near-term, we have a handle on these issues, and while they caused a delay in our ramp, we believe we can put them behind us and anticipate a trajectory of strong growth. With that said, it's a great accomplishment by the team to get units to customer sites and pass the heavy regimen of testing that has been demanded of them. 3 units are fully operational and running at a commercial customers campus in Southern California and at Softbank's test bed in Northern California. Additionally, the first two units we shipped, SDG . We're excited to have undertaken this next chapter and continue to prove that ESS ' solution can help solve the grid storage challenges. We also continue to make considerable progress building out the operations of the company. We doubled our company's headcount in 2021 to 161 and have added almost 25% to that since the end of '21. Importantly, we were able to add Ben Heng as SVP of Engineering. Ben brings broad technical background to the team and has held leadership roles at both SolarCity and Tesla. We are building out our sales team and announcing new customers. Additionally, we added 54,000 square feet to our Wilsonville facility in the fourth quarter, which helped us double our total footprint to 200,000 square feet in 2021. Given the supply chain environment, we have adjusted our production plan for 2022. We continue to plan a significant ramp in our Energy Warehouse shipment, as well as commencing shipment of our Energy Center product this year. Although the pace of growth will be considerable from quarter-to-quarter, we expect that the supply chain challenges we faced over the last four or five months will shift our production ramp to the right. This will represent a little more than a one-quarter shift in our expectations. Amir will share more details on the specifics of the plan. We will proceed with two cost reduction initiatives planned for this year, each of which is independent of our ramp speed. The first is standard design for manufacturing activities like replacing solder connections with wire harnesses and redesigning PCBs with more common components to cheapen and simplify assembly. The second is to incorporate our advanced automation line to maximize our production capacity by the end of 2022. These initiatives are expected to lower labor inputs by more than 80%, dramatically lowering unit costs and increasing production velocity and quality. The change in production ramp is in no way a reflection of the demand for our products, our confidence in our production capability, or the overall trajectory of the business, but rather a prudent adjustment to our ramp in response to macroeconomic conditions. This adjustment will have the added benefit of allowing us to implement cost reductions over fewer units shipped, thereby minimizing cash burn. Importantly, we've been in close communications with our customers, and shared the news of our new delivery schedule. To date, we have not had a single cancellation, and our customers remain committed to the units they have ordered. Finally, I would like to welcome Claudia Gast to the Board of Directors. With over 15 years of strategic and financial experience across leadership roles at Fortune 100 companies and investment firms. Claudia brings valuable experience in bringing hardened industrial products to market and scaling commercial organizations. Claudia will replace Shirley Speakman of Cycle Capital who led an early-stage investment in ESS. We also want to thank Shirley for her years of commitment to ESS, and her valuable contributions. And with that, I'll turn it over to Amir to take us through the financials. Amir Moftakhar: Thank you, Eric. Now, I will review the financials. While we shipped five Energy Warehouses in the latter part of 2021, we did not recognize revenue from these units in Q4. Revenue recognition will be deferred until customer acceptance has been received for each unit, or until we've established a history of successfully obtaining acceptance from each customer. In the near-term as our products are new, this is likely to be a longer process than when our products are more mature and we have more of a history with customer acceptance. As we are in the early stages of ramping the production of these units and are still under development accounting. We expensed the material overhead and labor cost be incurred, making the products we shipped to-date, resulting in zero cost of goods sold. Our non-GAAP operating expenses for Q4 were in line with our expectations at $15.5 million. With that, we reported Q4 non - GAAP adjusted EBITDA of $24 million in losses. Q4 GAAP net losses were $180.7 million, or negative $1.33 on a per-share basis. Moving to the balance sheet, we ended the year with $238.9 million in cash and short-term investments. In the fourth-quarter, cash used by operations was $23.5 million. As Eric shared, we have adjusted our production delivery expectations for 2022, due to the impacts and delays brought on by supply-chain challenges. To a great degree, this decision was out of our hands as we are navigating an unprecedented supply environment that began to impact us just as we were ramping manufacturing. Given that, our focus on production for 2022 will be in three key areas: deliver the units our supply will allow, execute the cost-savings programs that were already in flight, and make the necessary CapEx investments to maximize our production exit velocity at the end of 2022. Let me touch on each of these. First, despite our supply chain delays, we will continue with a strong ramp of our Energy Warehouse production in 2022. As a result of these delays, our planned shipment schedule is now a little more than one quarter later than we have previously expected. We remain on track to deploy our first Energy Center product in this fiscal year. Given our experience at early deployments and some legacy contractual terms in existing deals, we believe we will see a varied level of delay between shipments and revenue recognition. In our current process, we performed factory acceptance testing for ECW at our Wilsonville facility ahead of shipping units to a customer. Once received, we installing Commission these units when the customer side is ready. Finally, we perform additional acceptance testing protocols at the customer site, followed by a formal customer acceptance. For our early deployments, we expect revenue recognition to follow customer acceptance. As we build a track record of successful installation and acceptance, we expect customer acceptance and revenue recognition to occur more quickly. Given our new ramp schedule, we now expect to ship between 40 and 50 Energy Warehouses in 2022, all of which are contracted at this point. If we ship all of these units and are able to recognize revenue for them, this would translate to approximately $10 million in revenue. Second, we will execute plans to reduce our cost of goods sold in each unit. A significant portion of our cost reductions are design improvements that are not dependent on our scale, but reduce labor input and lower total production time. As Eric alluded to, these are designed for manufacturability initiatives we had already planned for this year. And third, as we shared last year, we ordered an automation line to dramatically expand our power module manufacturing throughput, a critical cost to ramping capacity. We expect this line to be up and running in late 2022. With each of these production improvements, design for manufacturability and automation, in place with a healthy supply chain backdrop our annual production throughput is expected to expand dramatically to 750 megawatt hours by the end of 2020, more than three times where we started the year. This would allow us to continue rapid growth into 2023. To reiterate an extremely important point, we have been very open with our customers about our delivery timing, and we have not received a single cancellation among our booked orders, nor have we seen any slowdown with ongoing customer conversations. I think this speaks to the value proposition ESS brings to our customers as well as the long-term strategic importance of implementing long-duration storage in our applications. Given our current plan and the assumption that we will remain under development accounting for the full year, we expect our operating expenses to come in at about $100 million. As we execute our plan in the coming year, we have more than ample liquidity to run the business and expect to end the year well in excess of $120 million of cash on the balance sheet. And with that, we can open up the line for questions. Operator: At this time. I would like to remind everyone in order to ask a question, please We'll pause for just a moment to compile the Q&A roster. Your first question comes from the line of Jed Dorsheimer from Canaccord Genuity. So, Jed, please go ahead when you're ready. Jed Dorsheimer: Hi. Thanks, guys. Wondering if you could just elaborate and provide some more details on the specifics of the customer acceptance. It sounds like three of the five are actually running. So, what specifically needs to be achieved for that acceptance to occur for the rev rec. Thanks. Eric Dresselhuys: Sure. Thanks, Jed, I'll take it. You're right. We've shipped a number of units. At two of the sites, the units have gone through the full installation, commissioning system startup, and actually, as of the time of this call, one of those units is totally completed with its revenue recognition process, so that's full testing and customer sign off. Another one we expect to be done in the next days to maybe a week. And then for some of the other units still, or being delivered, they'll go through that start-up routine and then they go through this very rigorous, complete testing when that's done. The customer signs off, and we'll get rev rec at that time. Jed Dorsheimer: Got it. Thanks. And you mentioned the supply chain and in particular chips. I know the containers were an issue at one point, but the chip issue sounds like that's a bigger I guess near-term. Headwind. Are there any others that you see as potential supply chain headwinds, or have all of the other ones been resolved and it's just about the redesign of the PCB? Eric Dresselhuys: Yeah. Thanks. Good memory. We have -- at one-point last year, we were having delays in getting shipping containers, but we were able to work through that. We've got plenty of containers now. On the chips, we're, we think, through that problem now. We had to do some redesign; it slowed us down back in the fall, but we've got alternative solutions now when we've pre -bought stock to not have that be a constraint. But you call out the right thing, which is these come up and you just have to work through them as they come up. So, at this -- as we sit here today, we feel good about having the supply that we need, and as we said in the release, we're working hard to ensure that we have alternative sources of supply so we have a bit more robust supply chain at every turn. Jed Dorsheimer: Great. Last question for me, then I'll jump back in the queue. Given the learning curve that you've gone through or continue to go through with the EW, I'm just wondering, has that changed any of the expectations around the EC either positively or negatively as you think about that and what you know now versus a year ago? Eric Dresselhuys: I think modestly positive inclinations towards the EC in the sense that we're just getting more experienced of all of the interface to our systems with renewable systems or grid systems out in the field. So, the more experience we get, the faster we get at a return. And so, I think that'll help with ECs as they come out online later this year. Jed Dorsheimer: Thank you. Eric Dresselhuys: Thank you Operator: Thank you, Jed. You now have the next question from Colin Rusch of Oppenheimer. Colin, please go ahead. Colin Rusch: Thanks so much. Can you talk a little bit about how much of manufacturing process is left because at this point as you move towards automation, is all the engineering done or is there still some work to be done process labs? Eric Dresselhuys: I think the engineering is done for the automation line that's coming online here this year. So, I don't see any engineering on our side. Of course, we have partners working with us that are building out the line so that design is complete. We're just waiting for all of the components of the automation to arrive. Colin Rusch: Okay. That's helpful. And then as you build this pipeline of business and you look at the pricing environment, we're seeing prices go up on lithium-based solutions. Generally, there's going to be a tight environment for supply with chemical storage for a number of years. I'm just wondering about your pricing power here and how you're thinking about the pricing model as you go forward. Eric Dresselhuys: Sure. Well, I think our pricing approach has always been trying to work on really being focused on a value approach. What's the value of our solutions versus the alternatives, versus doing nothing? And so, to that extent, as lithium prices have not only stopped declining, but starting to go up a little bit. I think that might give us a little bit of pricing power. But really for us, it's more about making sure that our total value proposition is being appreciated out by the customers. Colin Rusch: Okay. That's the point. Perfect for notifying. Thanks, guys. Eric Dresselhuys: Thank you. Operator: Thank you. Your next question comes from the line of Thomas Boyd of Cowen and Company. Sir, Thomas, your line is open. Thomas Boyd: Excellent. Thank you for taking my questions. Just the first one I was wondering if you can give us an update with the booking’s composition look like for 2023, how much has been awarded? How much is still being negotiated? And really what's in kind of a qualification phase. Amir Moftakhar: Good question, Thomas. Right now, with just given the shift in production schedule that we're seeing in 2022, we're not guiding towards what's booked, awarded, or negotiating right now in 2023. As Eric alluded to, we continue to have healthy, robust conversations with customers. We do anticipate the EC shipments starting this year. I think you'll see that shift in 2023 with the continuation of our EW product and the introduction of more EC projects. But at this time, we're not guiding to what's booked or awarded for 2023. Thomas Boyd: Understood. Then would it be fair to categorize maybe that pipeline, is it still around $8 billion as it was in 3Q? I know obviously that things have continued to expand as far as overall demand. So, I was just wondering about an update there. Amir Moftakhar: Yeah, so what we've shared is that our global opportunities are in that $8 billion range of customers that we've connected with for named projects that we have either exchanged some type of information such as an NDA or participated with them in in an RFP that there is no shortage of those opportunities. And that pipeline remains robust. And now it's about our execution through that pipeline for both the EW and EC products. Thomas Boyd: Great, and I appreciate it. A last one if I could sneak in really quick. Just what is the feedback that you've gotten from customers who have received the second-generation unit that maybe have also had a chance or opportunity to work with kind of that first-generation unit? Eric Dresselhuys: I think there's a lot of excitement around it. As we said, it's really a more ardent product, it's just at every turn products in terms of its delivery and its performance. So, people are excited about that. I think frankly the other thing that's probably come up since the first-generation products were shipped, is that the awareness of the market need for longer duration is more well-known, more acute today. So, people see the same product or same functionality, and they're more excited about it, than they've been before. One of the more surprising things that at least to me that we've heard when we shipped two of the Energy Warehouse s down to a customer in Southern California. And there's a video of this, I think on the website. The units were installed right next to the building. And people when they think about batteries, they think about something that's got to be remote, it's got to have a big safety perimeter because with Lithium that's what you do. And I have just been amazed at how many people see that picture and they're drawing hits the table and they can't believe that you can install long-duration storage in that easier package. It gets hoisted into place. The system is brought up and they can be installed so close to a building. And so, with the wildfires and other kind of safety issues that you've heard out in the marketplace. That's the number one thing we hear about from people when they see the installation happens. Thomas Boyd: Excellent. Appreciate the call to address the questions. . We now have the next question from Jayson Osha of Guggenheim. Your line is open. Jayson Osha: Hi there. Hi Eric? Eric Dresselhuys: Hello there, how are you? Jayson Osha: I'm good. Just a couple of questions here to go back to the guidance in that $10 million in revenue. And I believe that core waited to 50 EW units, is that -- that's what you said, right? Eric Dresselhuys: Yeah. That's right. Jayson Osha: Okay. Now is the idea that those 50 -- those would all be 50 units that were actually recognized for revenue? Or is it more that you're going to have 50 units out by the end of 2022, but only some of those would actually have manifested as revenue at that point? I just want to understand what's being said here. Eric Dresselhuys: Yes. So, what we've said is we expect to ship that many units. How the rev rec will play out as we alluded to in the call is a little hard to predict. If they would all get rev rec or where that cut-off would be depends a little bit on time and how much we're able to accelerate the commissioning process to move through the revenue recognition process. Jayson Osha: So that 50 units is units that you'd like to have in the field by the end of the year and some of those will be recognized and some modest. Is that the best way to think of it? Eric Dresselhuys: Well, I would tell you that certainly we would expect the vast majority of them to be recognized. There will be a question of whether they could all be recognized or not. Jayson Osha: Okay. That's fine. And just a follow-up on Jed's question. Obviously, the EC is a different thing. Can we expect to see any of the larger form factor EC is in the field in 2022. Eric Dresselhuys: As you said, we expect to start shipping units this year. Again, same question on revenue recognition. We’ll be -- get fully revenue recognized within the year. We've at this point not made claim to that, but we do expect to ship -- start shipping units this year. And as we've said, we expect that that ramp up will continue more dramatically as we get into '23. Jayson Osha: Sure. Got you. That makes sense. And then just seems out some folk’s stuff here. New one you'd mentioned that you're expensing a 100% of -- essentially a 100% of the cost of some of these units that are in the field awaiting recognition. When you talk about that, a 100 million in OpEx for 2022, does some of that a 100 million includes the absorption of potential product costs that are out there but not recognized yet, or is that all like real OpEx? Eric Dresselhuys: Yeah, good question. So as long as we're under development accounting, the OpEx would also include the product costs and future inventory purchases were making for future quarters or future years will all be expensed in that period. So that OpEx number includes the inventory and purchases for those products. Jayson Osha: Okay. Good. Would you care to break that $100 million down in terms of that product absorption versus like R&D and the normal course of business OpEx run-rate? Eric Dresselhuys: Yeah. We've not guided to that and wouldn't comment on that right now. I think as we get our fully automated line up and running and the cadence of shipments finds its way to a more normal state of business, we could provide more guidance on that. Jayson Osha: Okay. And then the last question from me -- sorry to beat you guys up. When you do recognize revenue, does some of that OpEx reverse back to COGS or do you just add revenue with 100% fall-through or how does that actually work? Eric Dresselhuys: So, we'll wait until we get to that point. I mean, there's certainly the opportunity to recognize revenue without the COGS recognize the revenue, and then the COGS would match the revenue or go to formal inventory accounting where you would see that. And we will guide on that when we get to that point. Jayson Osha: Okay. Thank you very much. Eric Dresselhuys: Thank you, Joe. Operator: Thank you. There are no questions at this time. Mr. Erik Dresselhuys. Eric Dresselhuys: Well, thank you all for joining the call today. In summary, we're more excited than we've ever been to be delivering our solutions in contribution to the global effort to de -carbonize the energy system. Governments and corporations have set ambitious goals and we are extremely well-positioned to help them meet those needs. As a well-funded public company, we now have the resources to make that vision a reality. In the coming months, we encourage you to mark our progress with announcements on customer shipments, new projects, and continued expansion of our production facilities. Until then we thank you for your time today, and we look forward to keeping you apprised of our progress. Operator: This concludes today's conference call. You may now disconnect your lines.
TD Cowen Downgrades ESS Tech to Hold, Stock Drops 6%
ESS Tech (NYSE:GWH) shares dropped more than 6% intra-day today after TD Cowen downgraded the company from Buy to Hold, with analysts slashing the price target from $10 to $3, citing mounting challenges tied to leadership changes, funding concerns, and extended timelines for profitability.
While acknowledging the company’s progress in reducing costs across its Energy Warehouse and Energy Center solutions, TD Cowen pointed out that ESS's strategic shift toward its Energy Base product—targeting higher power and longer-duration storage applications—is a necessary but risky transition, especially given recent pricing pressure in the lithium-ion battery market.
The downgrade is driven in part by uncertainties around ESS’s ongoing CEO search, combined with critical capital needs and a recent NYSE delisting notice, all of which cloud the near-term investment picture.
Although ESS maintains that its long-term gross margins could reach the high-30% range, that milestone appears to be several years away, and with no clear timeline to profitability, TD Cowen believes the stock will likely trade sideways in the near term.
TD Cowen Downgrades ESS Tech to Hold, Stock Drops 6%
ESS Tech (NYSE:GWH) shares dropped more than 6% intra-day today after TD Cowen downgraded the company from Buy to Hold, with analysts slashing the price target from $10 to $3, citing mounting challenges tied to leadership changes, funding concerns, and extended timelines for profitability.
While acknowledging the company’s progress in reducing costs across its Energy Warehouse and Energy Center solutions, TD Cowen pointed out that ESS's strategic shift toward its Energy Base product—targeting higher power and longer-duration storage applications—is a necessary but risky transition, especially given recent pricing pressure in the lithium-ion battery market.
The downgrade is driven in part by uncertainties around ESS’s ongoing CEO search, combined with critical capital needs and a recent NYSE delisting notice, all of which cloud the near-term investment picture.
Although ESS maintains that its long-term gross margins could reach the high-30% range, that milestone appears to be several years away, and with no clear timeline to profitability, TD Cowen believes the stock will likely trade sideways in the near term.
ESS Tech, Inc. (NYSE:GWH) Faces Analyst Downgrade Amid Competitive Energy Storage Market
- ESS Tech's consensus price target has been significantly reduced from $6 to $3, indicating a bearish outlook from analysts.
- Canaccord Genuity analyst George Gianarikas sets a new low price target of $1.25 for ESS Tech, reflecting a conservative view on the company's future.
- Despite challenges, ESS Tech remains a high-risk investment with potential rewards, focusing on market-ready energy storage solutions.
ESS Tech, Inc. (NYSE:GWH) is a company that focuses on the development and production of iron flow batteries, which are used for energy storage applications. Their products, such as the Energy Warehouse and Energy Center, are designed to provide cost-effective, non-toxic, and durable energy storage solutions. The company operates in the competitive energy storage market, where demand for long-duration energy storage is expected to reach 1,000 gigawatts by 2030.
Over the past year, the consensus price target for ESS Tech has seen a significant decline. Initially set at $6, the target has been adjusted to $3 in the last quarter and remains consistent. This downward trend indicates a more cautious or bearish outlook from analysts regarding the company's future stock performance. Factors such as market conditions, company performance, and changes in the competitive landscape may have influenced this shift.
Recently, Canaccord Genuity analyst George Gianarikas set a price target of $1.25 for ESS Tech. This reflects a more conservative view on the company's potential, as highlighted during the Q3 2024 earnings conference call. The call featured key company figures like CEO Eric Dresselhuys and CFO Anthony Rabb, along with analysts from various firms, including Canaccord Genuity.
Despite the lower price target, ESS Tech is positioned as a high-risk investment with potential rewards for patient investors. The company's technology is market-ready, with anticipated revenue from upcoming sales and strategic partnerships expected to enhance their global reach. As the company approaches its upcoming earnings report, investors should be prepared for the possibility of negative earnings, as the company might not meet anticipated benchmarks.
ESS Tech, Inc. (NYSE:GWH) Faces Analyst Downgrade Amid Competitive Energy Storage Market
- ESS Tech's consensus price target has been significantly reduced from $6 to $3, indicating a bearish outlook from analysts.
- Canaccord Genuity analyst George Gianarikas sets a new low price target of $1.25 for ESS Tech, reflecting a conservative view on the company's future.
- Despite challenges, ESS Tech remains a high-risk investment with potential rewards, focusing on market-ready energy storage solutions.
ESS Tech, Inc. (NYSE:GWH) is a company that focuses on the development and production of iron flow batteries, which are used for energy storage applications. Their products, such as the Energy Warehouse and Energy Center, are designed to provide cost-effective, non-toxic, and durable energy storage solutions. The company operates in the competitive energy storage market, where demand for long-duration energy storage is expected to reach 1,000 gigawatts by 2030.
Over the past year, the consensus price target for ESS Tech has seen a significant decline. Initially set at $6, the target has been adjusted to $3 in the last quarter and remains consistent. This downward trend indicates a more cautious or bearish outlook from analysts regarding the company's future stock performance. Factors such as market conditions, company performance, and changes in the competitive landscape may have influenced this shift.
Recently, Canaccord Genuity analyst George Gianarikas set a price target of $1.25 for ESS Tech. This reflects a more conservative view on the company's potential, as highlighted during the Q3 2024 earnings conference call. The call featured key company figures like CEO Eric Dresselhuys and CFO Anthony Rabb, along with analysts from various firms, including Canaccord Genuity.
Despite the lower price target, ESS Tech is positioned as a high-risk investment with potential rewards for patient investors. The company's technology is market-ready, with anticipated revenue from upcoming sales and strategic partnerships expected to enhance their global reach. As the company approaches its upcoming earnings report, investors should be prepared for the possibility of negative earnings, as the company might not meet anticipated benchmarks.
ESS Tech, Inc. (NYSE:GWH) Overview: A Key Player in the Energy Storage Industry
ESS Tech, Inc. (NYSE:GWH) is a pioneering company specializing in the development of iron flow batteries, catering to energy storage needs across commercial and utility-scale applications globally. With its headquarters in Wilsonville, Oregon, ESS Tech has established itself as a significant entity within the energy storage sector since its inception in 2011.
The company's product lineup includes the Energy Warehouse and the Energy Center, both of which underscore ESS Tech's commitment to innovation in energy storage solutions. Despite the stable consensus price target of $3 over recent months, a slight decrease from the previous year's $3.66 reflects the challenges and market dynamics the company faces. Analyst George Gianarikas from Canaccord Genuity has projected a more conservative price target of $1.25, signaling a cautious stance towards the company's stock.
ESS Tech is often regarded as a high-risk investment opportunity; however, its iron flow batteries present a compelling value proposition. These batteries are not only cost-effective and non-toxic but also boast a durability backed by a 10-year performance guarantee. With the global demand for long-duration energy storage projected to hit 1,000 gigawatts by 2030, ESS Tech is well-positioned to capitalize on this burgeoning market.
The company's leadership expressed optimism about the ongoing progress and the potential for sustained growth and success in the competitive energy storage market.
ESS Tech, Inc. (NYSE:GWH) Overview: A Key Player in the Energy Storage Industry
ESS Tech, Inc. (NYSE:GWH) is a pioneering company specializing in the development of iron flow batteries, catering to energy storage needs across commercial and utility-scale applications globally. With its headquarters in Wilsonville, Oregon, ESS Tech has established itself as a significant entity within the energy storage sector since its inception in 2011.
The company's product lineup includes the Energy Warehouse and the Energy Center, both of which underscore ESS Tech's commitment to innovation in energy storage solutions. Despite the stable consensus price target of $3 over recent months, a slight decrease from the previous year's $3.66 reflects the challenges and market dynamics the company faces. Analyst George Gianarikas from Canaccord Genuity has projected a more conservative price target of $1.25, signaling a cautious stance towards the company's stock.
ESS Tech is often regarded as a high-risk investment opportunity; however, its iron flow batteries present a compelling value proposition. These batteries are not only cost-effective and non-toxic but also boast a durability backed by a 10-year performance guarantee. With the global demand for long-duration energy storage projected to hit 1,000 gigawatts by 2030, ESS Tech is well-positioned to capitalize on this burgeoning market.
The company's leadership expressed optimism about the ongoing progress and the potential for sustained growth and success in the competitive energy storage market.
