TD's Take New Contract Announced
Event
Greenlane has been awarded an $8.7 million contract.
Impact: POSITIVE
Details: Greenlane has been awarded an $8.7 million contract to supply a
membrane-based upgrading system to a dairy manure project in the U.S. Importantly,
this award marks the third project win for Greenlane from the same customer in the
last 18 months, although the customer and location have not been disclosed at this
time. The company noted that order fulfilment will commence immediately, but did not
provide any additional details on completion date or timing of revenue recognition.
TD View: Cumulative Q2/22 orders now total $20.1 million, compared to our current
Q2/22 estimate of $25.7 million. As a result, we will not be updating our estimates
at this time and view the announcement as consistent with our growth thesis for the
broader RNG sector and our view that Greenlane has developed a commercially
viable business model that is well-positioned to maximize market opportunities by
offering the three most common types of biogas upgrading systems (membrane,
PSA, and water wash)
Recommendation: SPEC BUY
12-Month Target Price: C$1.60