Ocean Power Technologies (OPTT) rallies 45% up in the last week

We are actually experiencing the most interesting years of the stock market. We are going to see breakthrough technology utilizing other great technologies to create great things – one of them is what is hidden in this article – greater than we ever expected.

I have been researching stocks of the renewable energy sector as investors become more interested in it. I found out about Ocean Power Technologies (OPTT) three months ago. I must admit when I found out what the company is doing and the kind of technology they are using I personally bought the stock. In this article, I aim to highlight the importance of its systems, how they produce electricity and how this can change the world.


Why OPTT products are the future?

Ocean Power Technologies, Inc. (NASDAQ: OPTT) is the leader in wave energy based renewable energy. The company exists since 1984 its headquartered in New Jersey, U.S. Ocean Power Technologies is developing and seeking to commercialize its systems that generate electricity from the ocean waves. Just think about it for a minute, electricity generated from the ocean waves! The company has three main products as the PB3 PowerBuoy, hybrid PowerBuoy and Subsea battery.

PB3 PowerBuoy

Source: Oceanpowertechnologies.com

The most interesting thing is its PB3 PowerBuoy, which uses technologies to convert the energy created by the movement of ocean waves to electricity. What makes this product unique is its act of an Uninterruptable Power Supply (UPS). PB3 can constantly recharge itself by gathering energy from the waves which can float and operate in any ocean depth over 20 meters and up to 3,000 meters.

The conversion of the wave energy into electric power is achieved by a direct drive generator that continuously charges an on-board battery pack Energy Storage System. It is also designed to specifically store sufficient energy power in times extended times when the seas are flat. The product was specially made to minimize operational expenses while controlling and managing through self-monitoring data collection.

Hybrid PowerBuoy

The hybrid PowerBuoy is a companion to the PB3 PowerBuoy. It stores power for surface and subsea payloads in onboard lithium iron phosphate batteries primarily charged from solar panels. This makes the product a low to zero-emission power solution. The company has also managed to add to its OPT solution payload that includes a camera, radar, 4G/5G and Wi-Fi. The markets that it can operate include offshore industries such as oil and gas, science and research, communications and defense & security.

With such technologies, maritime surveillance and security will be able to better monitor illegal activities that are happening in the sea. Human trafficking, narcotics, illegal border crossings are a challenge considering the areas that need to be monitored.

OPT’s PB3 has been tested in the oceans and has proved that it can improve maritime security and interdiction. The advantages that it brings vary from low costs resulting from reduced human intervention, economies of scale and improved security.

Source: Oceanpowertechnologies.com

OPT’s subsea battery is environmentally friendly made of lithium-iron-phosphate (LiFePO4) batteries and fully constructed by steel. LiFePO4 batteries have extremely low self-discharge rates while in standby mode, storage or transport, as compared to other chemistries. Like the hybrid PowerBuoy the Subsea battery is designed to integrate with the PB3 PowerBuoy, however, it can be utilized as a stand-alone power source or can be configured for recharge by other sources.

OPTT stock price and financials

Ocean Power Technologies will be one of the clean energy stocks that will benefit from Biden’s presidency. The stock price has already shown signs of going up yesterday and last week in general. Since I personally know the movements of the stock, I know that it hasn’t been this volatile before or at least in the last three months, until last week. The stock price as of yesterday’s close is $4.18 or 16% up while it has been up 45% in the last week. By the end of November, the stock moved from $1.60 to $2.55.

The company’s financials do not look as good as expected looking at the three months ended in October. The total revenue has decreased from $204,000 to $118,000 while the gross loss has also widened (even if negative) from -$84,000 to -$98,000. Moreover, the basic and diluted EPS has minimized its loss from -$0.51 to -$0.15 net loss per share. According to Nasdaq.com, the estimated earnings report in on 03/08/2021 but this date might change.

In the image above we can see that the volume of the stock very low with its peak taking place in October. OPTT’s market cap is 128 million. We can also notice that the stock touched its highest high yesterday. The reason surrounding this rise is due to Biden’s administration focusing on clean energy sources.

First remotely managed PowerBuoy deployment

The technology that the company is using while generating electricity just from ocean waves does not require any kind of infrastructure. This leader in innovative and cost-effective ocean energy solutions has announced in December 2020 its contract with SeaTrepid International LCC to deploy a PB3 PowerBuoy and oceanographic monitoring system off the coast of Chile. 

George H. Kirby, President and Chief Executive Officer of OPT. “Remotely managed system deployments and recoveries that leverage local contractors and dovetail with existing marine operations can reduce cost and increase flexibility for our customers. SeaTrepid’s reputation for safe execution of complex marine operations gives us great confidence that our first remotely managed deployment will be successful.”

Overall, the company needs to improve its earnings in the upcoming report, in order for it to jump even more. However, if investors can see and believe in its technology system the stock can still expect a rise on speculations. We have already see this happening with Fuel Cell Energy (FCEL) last week.

Disclaimer – I/we have no position in any stock mentioned. I wrote this article myself, and it expresses my personal opinions. I am not receiving any compensation for it, other than FDGT Academy. I do not have or had in the past any business relationship with any company that is mentioned in the above article.

Natalia C. - Junior Analyst at FDGT Academy

Natalia C. - Junior Analyst at FDGT Academy

I am a stock analyst/investor with prior experience and knowledge to BSc Accounting and Finance. After completing my degree and exposure to the accounting firms I decided that the direction I should choose is towards the Investment world. I completed my masters in Investment Management where it gave me solid fundamentals to build my career on. I have examined a lot of different aspects of investment, from REITS, derivatives, currencies, bonds, equity and hedge funds. I never stopped learning about the market which is why I can analyze and write articles for FDGT community always personally opinionated. My passion are green energy and electric vehicles stocks as a whole. I also had my share of analyzing the work form home stocks that are coming to take over in the upcoming years.