G&M Upgrades and Comments March 03 After meeting with Exro Technologies Inc.’s (EXRO-X -44.72%decrease
) management and investors to discuss a Seeking Alpha report that accused the Vancouver-based company of exaggerating partnerships and brought forward leadership concerns, Raymond James analyst Michael Glen said his opinion on its technology, management team and outlook “have not been impacted in any way, shape, or form.”
Accordingly, he raised his rating for its shares to “strong buy” from “outperform.”
“This report had a significant impact on Exro’s stoc kprice (down 45 per cent) and our call addressed the allegations head on,” said Mr. Glen. “Attending the call were Sue Ozdemir, CEO, Mark Godsy, Executive Chairman, and John Meekinson, CFO. Exro also released an Integrity Statement which emphasizes the company ‘will not take this report lightly’ and will be providing a more detailed release ‘in the next 48 hours’ against the claims made. We anticipate this release will also include comments/feedback from customers/partners.”
“What we found most glaring in the report was what was omitted. The author failed to mention very specific aspects that are critically important to our favourable view.”
Mr. Glen maintained a $9 target for Exro shares. The average is $6.23.
“We acknowledge that valuing a stock like Exro is challenging,” he said. “The company has a unique technology that offers a number of advantages to its customers, and we see them positioned in a segment of the market about to see massive growth. We have a significant amount of conviction in the stock and we believe the accusations in the Seeking Alpha report do not accurately describe the company, technology, management team and outlook for business. We use a target multiple of 20 times our 2024/2025 estimated revenue, which we recognize is aggressive but is characteristic of the massive growth potential of the company. All-in-all, we still see several positive catalysts over the coming year, and therefore we are upgrading.”