Haywood upgrade $8.00
Exro Technologies Inc. (EXRO-V, $4.58)
RATING: BUY TARGET: $8.00 (from $6.00) RISK: Very High
RESUMING COVERAGE
One of Canada’s Next Billion Dollar Tech Companies in 2021? We Think So; Increasing Target to $8.00/sh
OUR TAKE
We are resuming coverage of Exro following the close of the Company’s oversubscribed equity financing for gross proceeds of $42 MM at $3.25/sh. With ~$10 MM in cash (no debt) prior to announcement, we were surprised at the time by the financing but see it as a positive on several fronts: 1) Exro is cashed up with a long runway to significantly advance both its coil driver and battery management technologies; 2) New major (unnamed) investor adds further credibility to the story. With the financial flexibility to accelerate proof-of-concept and deployment across several focus areas (coil driver and battery mgmt.) over the next twelve months we are revising our target price higher as we anticipate management is likely to continue to execute on value additive items in sectors highly sought after by investors, similar to the track record built through 2020. Reiterate our Buy Rating; Increasing Target Price to $8.00/sh (from $6.00).