- Lithium-ion battery maker Freyr is breaking floor on an enormous manufacturing unit in Norway, and analysts are taking discover, boosting the value goal
- The corporate can also be trying to develop within the U.S. and Japan
- Freyr already struck a partnership with Volkswagen to develop lithium-battery know-how for electrical automobiles
Clear-tech battery maker Freyr (NYSE: FREY) is proving to be a hit story on a number of ranges. The inventory seems poised for extra positive aspects as the corporate ramps as much as higher serve the electrical car market.
The Norwegian firm designs and manufactures lithium-ion batteries for numerous purposes together with EVs, stationary power storage, and marine and aviation makes use of.
The inventory gapped up on the open Friday, on information that it was starting development of a battery manufacturing unit in Mo i Rana, Norway. This can be a vital improvement, because it allows the younger firm to spice up its capabilities in fast-growing markets, comparable to EVs.
It will be the most important such plant exterior China. It arrives at a time when worldwide producers want to supply parts from international locations apart from China.
The inventory worth rallied 8.38% up to now month, 105.86% up to now three months, and 22.63% year-to-date, simply outperforming the broader market.
Freyr shares bought a lift on September 21, after Morgan Stanley analyst Adam Jonas raised his worth goal to $26 from $18, and gave the inventory an “chubby” designation. Jonas additionally wrote a analysis be aware outlining elements prone to improve the inventory worth, together with the brand new manufacturing unit.
The consensus score on the inventory is “reasonable purchase,” with a worth goal of $21.50, a 51.09% upside.
As a result of the corporate is comparatively new and with out earnings, there’s sparse analyst protection. Even so, eight of the 9 analysts following the inventory have optimistic scores, with the ninth being impartial.
In December, Freyr introduced a partnership with Cambridge, Massachusetts-based 24M Applied sciences and Volkswagen (OTCMKTS:VWAGY) to fabricate next-generation lithium-ion EV batteries using 24M’s SemiSolid platform. The partnership goals to develop manufacturing know-how for SemiSolid battery cells for Volkswagen electrical automobiles.
“The event of next-generation EV battery cells primarily based on 24M know-how is a essential ingredient of Freyr’s long-term technique to hurry up the adoption of inexpensive EVs,” stated Freyr CEO Tom Jensen, in a launch saying the partnership.
Additional solidifying Freyr’s dedication to the EV battery partnership, the corporate opened a Boston workplace in August, co-located with 24M. It additionally opened a facility in Japan, which, not coincidentally, is residence to a number of main automakers.
Though not confirmed, Freyr is reportedly in talks to construct a lithium battery manufacturing unit within the U.S. The corporate is alleged to have narrowed its choice standards down to 5 websites.
As you would possibly count on, Freyr will seemingly profit from tax benefits baked into the not too long ago handed Inflation Discount Act.
The corporate may be very a lot in start-up mode, having merged with a SPAC, Alussa Power Acquisition Corp., to record on the NYSE. It’s considerably of a unicorn, as many mergers from the SPAC growth have failed.
Freyr continues to be pre-earnings and income, because it’s funded by personal fairness and public markets. Nonetheless, there was a lot trigger for optimism within the firm’s second-quarter report in August.
For instance, it plans to copy the mannequin established by the upcoming Norwegian manufacturing unit. It additionally expects extra know-how licensing offers, in addition to partnerships with builders of complementary applied sciences, comparable to 24M.
As well as, the corporate has maintained its capability steering by means of 2030, primarily based on provide and demand dynamics in its core markets.
Freyr is a kind of shares that appears well-positioned for future progress, though it’s not at present a frontrunner relating to the basics. Along with its plans for natural progress, firms like Freyr typically develop organically and ultimately place themselves as acquisition targets. It wouldn’t be shocking to see numerous avenues that shareholders might be rewarded.