Graham Corporation designs, manufactures and sells critical equipment for the energy, defense and chemical/petrochemical industries. The Company designs and manufactures custom-engineered ejectors, vacuum pumping systems, surface condensers and vacuum systems. It is a nuclear code accredited fabrication and specialty machining company. It supplies components used inside reactor vessels and outside containment vessels of nuclear power facilities. Its equipment is found in applications, such as metal refining, pulp and paper processing, water heating, refrigeration, desalination, food processing, pharmaceutical, heating, ventilating and air conditioning. For the defense industry, its equipment is used in nuclear propulsion power systems for the United States Navy. The Company’s products are used in a range of industrial process applications in energy markets, including petroleum refining, defense, chemical and petrochemical processing, power generation/alternative energy and other.
Joe Gomes, CFA, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
2Q24 Results. The improved top and bottom lines reflect Graham’s successful operating strategy, in our view. The first quarter can be characterized by solid growth, consistent improvement, and strengthened profitability. We also would note the expansion of Graham’s defense business has reduced the Company’s economic sensitivity.
New Orders. Graham’s Barber-Nichols segment reported the receipt of three new awards, totaling in excess of $65 million. An extension of work for the MK48 Mod 7 Heavyweight torpedo program, received in the first quarter; a new program for the Columbia-class submarine; and a contract to provide cryogenic recirculation pumps for space vehicles. We believe these awards demonstrate the Company’s capabilities to successfully compete in its key markets.
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This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
Key Points: – Algonquin (AQN) to sell renewable energy business to LS Power for up to $2.5 billion – Transaction aims to transform AQN into a pure-play regulated utility – Deal expected to close in Q4 2024 or Q1 2025, subject to regulatory approvals
Algonquin Power & Utilities Corp. (AQN) has announced a strategic move to reshape its business model, entering into a definitive agreement to sell its renewable energy business to LS Power for a total consideration of up to $2.5 billion. This transaction marks a significant milestone in AQN’s transformation into a pure-play regulated utility, aligning with the company’s objective to enhance long-term value for both customers and shareholders.
The deal, unanimously approved by AQN’s board of directors, involves the sale of the company’s renewable energy assets, excluding its hydro operations. The transaction structure includes $2.28 billion in cash at closing, subject to certain adjustments, and a potential additional $220 million through an earn-out agreement related to specific wind assets.
Chris Huskilson, CEO of AQN, expressed satisfaction with the outcome of what he described as a “highly competitive strategic sale process.” He emphasized that this transaction, coupled with the previously announced plan to support the sale of AQN’s Atlantica shares, delivers on the company’s strategy to optimize its regulated business activities, strengthen its balance sheet, and improve the quality of its earnings.
The renewable energy business being divested has been a significant part of AQN’s operations for over three decades. Huskilson acknowledged the hard work and dedication of the employees who contributed to building this “compelling and competitive business with scale and strong assets.”
From a financial perspective, AQN expects to receive estimated cash proceeds of approximately $1.6 billion after accounting for the repayment of construction financing, taxes, transaction fees, and other closing adjustments. This influx of capital is expected to play a crucial role in recapitalizing the company’s balance sheet and positioning it for future growth within the regulated utility sector.
The transaction is subject to customary closing conditions, including approvals from the U.S. Federal Energy Regulatory Commission and relevant competition authorities. AQN anticipates the deal will close either in the fourth quarter of 2024 or the first quarter of 2025.
This strategic divestment comes at a time when many energy companies are reevaluating their business models in response to changing market dynamics and regulatory environments. By focusing on its regulated utility operations, AQN aims to provide more predictable earnings and stable returns for investors, while continuing to deliver reliable energy and water solutions to its customer base of over one million connections, primarily in the United States and Canada.
As AQN transitions to a pure-play regulated utility, investors and industry observers will be watching closely to see how this strategic shift impacts the company’s financial performance and market position in the coming years. The move represents a significant change for a company that has long been known for its diversified portfolio of generation, transmission, and distribution assets.
With this transaction, Algonquin Power & Utilities Corp. is betting on the stability and predictability of regulated utility operations to drive its future growth and shareholder value. As the energy landscape continues to evolve, AQN’s strategic pivot may serve as a case study for other companies in the sector considering similar transformations.
Key Points: – Oil prices rise amid concerns over Middle East instability and positive US economic data – Tight global supply and potential weather disruptions add further upside risk – Investors should monitor geopolitical developments and economic indicators closely
As investors closely track the volatile oil markets, the latest developments have painted a complex picture, with geopolitical tensions and economic resilience emerging as the key drivers behind the recent price rebound. The oil benchmarks, Brent and WTI, have staged a recovery after hitting an eight-month low earlier this week, signaling the industry’s sensitivity to both supply-side and demand-side factors.
The catalyst for the price increase was a combination of heightened tensions in the Middle East and positive economic data from the United States. The killing of senior members of militant groups Hamas and Hezbollah last week has raised the specter of potential retaliatory strikes by Iran against Israel, stoking concerns over oil supply from the world’s largest producing region. “It will spike the price of crude oil if there is an Iranian retaliation on a large scale and I think that is what everyone is most worried about,” said Tim Snyder, chief economist at Matador Economics.
Compounding these geopolitical risks, the latest US job market data provided a positive surprise, easing fears of a wider economic slowdown and its potential impact on oil demand. The number of Americans filing new applications for unemployment benefits fell more than expected last week, suggesting the labor market remains robust despite recessionary headwinds. “The latest US data on jobless claims indicates still a growing U.S. economy, reducing some of the oil demand concerns,” said UBS analyst Giovanni Staunovo.
Furthermore, the Energy Information Administration reported a significant 3.7 million barrel drop in US crude inventories last week, marking the sixth consecutive weekly decline to six-month lows. This tightening of global supply, coupled with the potential for weather-related disruptions during the hurricane season, has added to the upside pressure on oil prices.
Looking ahead, analysts at Citi believe there is a possibility of oil prices bouncing to the low to mid-$80s per barrel for Brent, citing “still-tight balances through August, heightened geopolitical risks across North Africa and the Middle East, the possibility of weather-related disruptions through hurricane season and light managed money positioning.”
For investors, navigating the oil market landscape requires a careful balance of monitoring both geopolitical developments and economic indicators. The escalating tensions in the Middle East, coupled with the resilience of the US economy, have underscored the complex interplay between supply-side and demand-side factors that ultimately shape the trajectory of oil prices.
As the industry continues to grapple with these dynamics, investors should remain vigilant in assessing the potential risks and opportunities that may arise. Close attention to factors such as inventory levels, weather patterns, and global economic trends will be crucial in making informed investment decisions in the volatile oil market.
Australia’s Woodside Energy has taken the energy sector by surprise, announcing its acquisition of Tellurian for $1.2 billion, staking its claim on the ambitious yet troubled Driftwood LNG project in Louisiana. This transaction marks a significant departure from Woodside’s traditionally conservative approach, signaling a dramatic shift in its global LNG strategy.
The Driftwood project, long considered one of the most challenging prospects in the U.S. LNG sector, has struggled to gain traction despite years of development efforts. Tellurian’s inability to secure long-term off-take agreements has been a persistent obstacle, leaving many industry analysts skeptical about the project’s viability. Woodside’s decision to take on this challenge represents a calculated risk that could potentially reshape the company’s position in the global energy market.
Woodside CEO Meg O’Neill has framed this acquisition as a strategic move to establish the company as an “LNG powerhouse.” However, this ambitious goal comes at a time when the energy industry is navigating complex transitions, with increasing pressure to reduce carbon emissions and pivot towards renewable sources. Woodside’s substantial investment in LNG infrastructure appears to run counter to these trends, raising questions about the long-term wisdom of such a commitment.
Perhaps the most intriguing aspect of this deal is Woodside’s proposed departure from the traditional U.S. LNG business model. Rather than adopting the typical tolling approach, where LNG facilities essentially function as processing units for natural gas, Woodside intends to implement a fully integrated strategy. This would encompass control from the wellhead to the final point of sale, potentially allowing for greater flexibility and profitability, but also introducing additional complexities and risks.
The timing of this acquisition is particularly noteworthy. With Europe actively diversifying its energy sources away from Russian gas and Asian demand for LNG continuing to grow, Woodside is positioning itself to capitalize on these market dynamics. However, the Driftwood project’s extended development timeline means that Woodside may miss out on the current favorable market conditions, potentially facing a different landscape upon project completion.
Woodside’s strategy to mitigate risk by bringing in partners and reducing its equity stake to around 50% is prudent, but may prove challenging. The project’s history of struggling to secure long-term commitments suggests that finding willing investors could be an uphill battle, even with Woodside’s involvement.
This transaction has the potential to be transformative for both Woodside and the broader LNG industry. If successful, it could catapult Woodside into the upper echelons of global LNG producers, surpassing even some of the oil and gas majors. However, the risks are substantial, and the execution of this strategy will be closely watched by industry observers and competitors alike.
Ultimately, Woodside’s acquisition of Tellurian and the Driftwood LNG project represents a high-stakes wager on the future of natural gas in the global energy mix. As the world grapples with the complexities of energy transition, Woodside’s bold move could either position them at the forefront of the LNG market or serve as a cautionary tale of misplaced optimism in a rapidly evolving industry.
As this ambitious project unfolds, it will undoubtedly provide valuable insights into the future direction of the LNG sector and the role of natural gas in the broader energy landscape. The industry will be watching closely to see if Woodside’s gambit pays off in this high-risk, high-reward venture.
Mark Reichman, Managing Director, Equity Research Analyst, Natural Resources, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Updating estimates. We increased our 2024 adjusted funds flow (AFF) and earnings per share (EPS) estimates to C$44.3 million and C$0.34 from C$40.9 million and C$0.30. Our revisions are driven by higher crude oil price assumptions and a redistribution of quarterly production estimates. While we have assumed higher oil prices in the second and third quarters, our model assumes prices weaken in the fourth quarter. We increased our 2025 AFF and EPS estimates to C$41.1 million and C$0.30, respectively, from C$31.4 million and C$0.21 based on higher production volume and crude oil price assumptions. We think our 2025 estimates could be conservative if the company can increase annual production within its targeted range of 10% to 20%.
Normal course issuer bid (NCIB). Hemisphere renewed its NCIB to purchase up to 8,255,766 common shares, representing ~10% of the current public float, for cancellation. The NCIB commenced on July 14 and will terminate on July 13, 2025. Under its previous NCIB, which authorized the repurchase of 8,670,636 shares and terminated July on 13, the company purchased 4,074,400 shares on the open market at a weighted average price of C$1.425. Shares are generally purchased opportunistically during periods of weakness.
Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.
This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
Vancouver, British Columbia–(Newsfile Corp. – July 11, 2024) – Hemisphere Energy Corporation (TSXV: HME) (OTCQX: HMENF) (“Hemisphere” or the “Company”) is pleased to announce that the TSX Venture Exchange (the “TSXV”) has accepted the Company’s Notice of Intention to renew of its Normal Course Issuer Bid (the “NCIB”) to purchase for cancellation, from time to time, as Hemisphere considers advisable, up to 8,255,766 common shares (“Common Shares”) of the Company, representing approximately 10% of the current public float of the Common Shares.
Purchases of Common Shares will be made on the open market through the facilities of the TSXV. For any Common Shares purchased, Hemisphere will pay the prevailing market price of the Common Shares. The actual number of Common Shares that may be purchased for cancellation and the timing of any such purchases will be determined by the Company and dependent on market conditions.
The Company is commencing the NCIB because it believes that, from time to time, the market price of its Common Shares may not properly reflect the underlying, intrinsic value of the Company, and that, at such times, the purchase of Common Shares for cancellation will increase the proportionate interest of, and be advantageous to, all remaining shareholders.
The NCIB will commence on July 14, 2024 and will terminate on July 13, 2025 or at such earlier time as the NCIB is completed or terminated at the option of Hemisphere. The Company has retained Canaccord Genuity Corp. as its broker to conduct the NCIB on its behalf.
Under the Company’s previous notice of intention to conduct a normal course issuer bid, the Company sought and received approval of the TSXV to purchase 8,670,636 Common Shares for the period from July 14, 2023 to July 13, 2024. During that period, the Company purchased 4,074,400 Common Shares on the open market at a weighted-average price of $1.425 per Common Share.
About Hemisphere Energy Corporation
Hemisphere is a dividend paying Canadian oil company focused on maximizing value per share growth with the sustainable development of its high netback, low decline conventional heavy oil assets through polymer flood enhanced recovery methods. Hemisphere trades on the TSX Venture Exchange as a Tier 1 issuer under the symbol “HME” and on the OTCQX Venture Marketplace under the symbol “HMENF”.
For further information, please visit the Company’s website at www.hemisphereenergy.ca to view its corporate presentation or contact:
Don Simmons, President & Chief Executive Officer Telephone: (604) 685-9255 Email: info@hemisphereenergy.ca
Note Regarding Forward-Looking Statements and Other Advisories
This document contains forward-looking information. This information relates to future events and the Company’s future performance. All information and statements contained herein that are not clearly historical in nature constitute forward-looking information, and the words “may”, “will”, “should”, “could”, “expect”, “plan”, “intend”, “anticipate”, “believe”, “estimate”, “propose”, “predict”, “potential”, “continue”, “aim”, or the negative of these terms or other comparable terminology are generally intended to identify forward-looking information. Such information represents the Company’s internal projections, estimates, expectations, beliefs, plans, objectives, assumptions, intentions or statements about future events or performance. This information involves known or unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking information. Hemisphere believes that the expectations reflected in this forward-looking information are reasonable; however, undue reliance should not be placed on this forward-looking information, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. This press release contains forward-looking information concerning, among other things, the anticipated advantages of the NCIB to Hemisphere’s shareholders and the Company’s business strategy, the price to be paid by Hemisphere for purchases of Common Shares under the NCIB and Hemisphere’s plans for maximizing value per share growth with the sustainable development of its high netback high netback, low decline conventional heavy oil assets through polymer flood enhanced recovery methods. The reader is cautioned that such information, although considered reasonable by the Company, may prove to be incorrect. A number of risks and other factors could cause actual results to differ materially from those expressed in the forward-looking information contained in this document including, but not limited to, the risk that the anticipated benefits of the NCIB may not be achieved and the risk that the Company may not be able to successfully execute its business strategy or growth plans. Readers are cautioned that the foregoing list of factors is not exhaustive. Although the forward-looking statements contained in this document are based upon assumptions which management of Hemisphere believes to be reasonable, Hemisphere cannot assure investors that actual results will be consistent with these forward-looking statements. With respect to forward-looking statements contained in this document, Hemisphere has made assumptions regarding, among other things, the ability of Hemisphere to fund purchases of Common Shares under the NCIB and its business strategy. These forward-looking statements are made as of the date of this document and Hemisphere disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.
In a surprising turn of events, oil prices have climbed for the second consecutive session, with Brent crude settling above $85 per barrel. This uptick comes as hopes for U.S. interest rate cuts were fueled by an unexpected slowdown in inflation. The market’s reaction to these economic indicators highlights the intricate connections between macroeconomic factors and commodity prices.
The latest data from the U.S. Bureau of Labor Statistics revealed a decline in consumer prices for June. This unexpected drop has boosted expectations that the Federal Reserve might cut interest rates sooner than anticipated. Following the release of the inflation data, traders saw an 89% chance of a rate cut in September, up from 73% the day before. Slowing inflation and potential rate cuts are expected to spur more economic activity. Analysts from Growmark Energy have noted that such measures could bolster economic growth, subsequently increasing demand for oil.
Federal Reserve Chair Jerome Powell acknowledged the recent improvements in price pressures but stressed to lawmakers that more data is needed to justify interest rate cuts. His cautious approach underscores the Fed’s commitment to data-driven policy decisions. The possibility of rate cuts also impacted the U.S. dollar index, causing it to drop. A weaker dollar generally supports oil prices by making dollar-denominated commodities cheaper for buyers using other currencies. Gary Cunningham, director of market research at Tradition Energy, emphasized this point, noting that a softer dollar could enhance oil demand.
The rise in oil prices also reflects broader market dynamics. On Wednesday, U.S. data showed a draw in crude stocks and strong demand for gasoline and jet fuel, ending a three-day losing streak for oil prices. Additionally, front-month U.S. crude futures recorded their steepest premium to the next-month contract since April. This market structure, known as backwardation, indicates supply tightness. When market participants are willing to pay a premium for earlier delivery dates, it often signals that current supply isn’t meeting demand.
While current market conditions suggest strong demand, future demand forecasts from major industry players show significant divergence. The International Energy Agency (IEA) recently predicted global oil demand growth to slow to under a million barrels per day (bpd) this year and next, mainly due to reduced consumption in China. In contrast, the Organization of the Petroleum Exporting Countries (OPEC) maintained a more optimistic outlook, forecasting world oil demand growth at 2.25 million bpd this year and 1.85 million bpd next year. This discrepancy between the IEA and OPEC forecasts is partly due to differing views on the pace of the global transition to cleaner fuels.
Alex Hodes, an analyst at StoneX, noted that the divergence in demand forecasts is unusually wide, attributing it to varying opinions on how quickly the world will shift to cleaner energy sources. This uncertainty adds another layer of complexity to market predictions and planning.
The interplay between inflation data, interest rate expectations, and oil demand forecasts creates a nuanced picture for the future of oil prices. If the Federal Reserve proceeds with rate cuts, increased economic activity could boost oil demand. However, the ongoing transition to clean energy and geopolitical factors will continue to play crucial roles. For now, market participants and analysts will closely monitor economic indicators and policy decisions. The recent rise in oil prices highlights the market’s sensitivity to macroeconomic trends and the importance of timely and accurate data in shaping market expectations.
These recent movements in oil prices underscore the complex interdependencies between economic data, policy decisions, and market dynamics. As inflation shows signs of cooling and hopes for rate cuts grow, the oil market is poised for potentially significant shifts. Understanding these trends is crucial for stakeholders across the industry as they navigate the evolving landscape of global energy markets.
In a bold move that underscores its commitment to the energy transition, Honeywell International Inc. (NYSE: HON) announced on Wednesday its agreement to acquire Air Products’ (NYSE: APD) liquefied natural gas (LNG) process technology and equipment business for $1.81 billion in cash. This acquisition, Honeywell’s fourth in 2024, signals the industrial giant’s aggressive push into the burgeoning LNG market and its determination to position itself as a key player in the global energy landscape.
The deal comes at a time when LNG demand is surging, particularly in power generation and data center applications. According to the Energy Information Administration, U.S. LNG exports are projected to reach 12.2 billion cubic feet per day in 2024 and 14.3 billion cubic feet per day in 2025, up from a record 11.9 billion cubic feet per day in 2023. This growth trajectory presents a significant opportunity for Honeywell to capitalize on the increasing global appetite for cleaner energy sources.
By acquiring Air Products’ LNG unit, Honeywell gains access to cutting-edge technologies such as heat exchangers and cryogenic equipment, which complement its existing LNG pretreatment business. The addition of Air Products’ coil-wound heat exchangers, known for their efficient liquefaction capabilities and minimal space requirements, will enhance Honeywell’s competitive edge in both onshore and offshore LNG applications.
From an investor’s perspective, this acquisition aligns perfectly with Honeywell’s strategic focus on three “mega trends” identified by CEO Vimal Kapur: automation, the future of aviation, and energy transition. The LNG business acquisition squarely addresses the energy transition pillar, potentially opening up new revenue streams and market opportunities for the company.
Financially, the deal is expected to be accretive to Honeywell’s adjusted earnings per share in the first full year of ownership. Analyst Sheila Kahyaoglu from Jefferies estimates that the transaction could boost adjusted earnings by approximately 1% in 2025. Moreover, Honeywell anticipates growth opportunities in aftermarket services and digitalization through its Forge platform, which could further enhance the deal’s long-term value proposition.
The acquisition also demonstrates Honeywell’s commitment to growth through strategic M&A activity. With this latest deal, the company is on track to deploy around $15 billion in acquisitions in 2024 alone, a clear indication of its aggressive growth strategy and confidence in its ability to integrate and leverage new technologies and market positions.
For investors, Honeywell’s move into the LNG space offers exposure to a critical segment of the energy transition. As countries worldwide seek to reduce their carbon footprint while ensuring energy security, LNG is increasingly seen as a crucial “bridge fuel” in the shift from coal to renewables. Honeywell’s enhanced capabilities in LNG technology position it to benefit from this global trend.
However, investors should also consider the potential risks. The LNG market can be volatile, subject to geopolitical tensions and fluctuations in global energy demand. Additionally, the success of the acquisition will depend on Honeywell’s ability to effectively integrate Air Products’ LNG business and leverage its technologies across its existing customer base.
Honeywell’s $1.81 billion acquisition of Air Products’ LNG business represents a strategic bet on the future of energy. This move positions the company as a more comprehensive player in the LNG value chain, potentially opening up new revenue streams and market opportunities. For investors seeking exposure to the energy transition trend through a diversified industrial giant, this deal enhances Honeywell’s appeal. The company’s ability to integrate this acquisition effectively and leverage its new technologies across its existing customer base will be crucial to realizing the full value of this investment. As Honeywell continues to align itself with key technological and market trends, investors should closely monitor how this strategic move contributes to the company’s long-term growth trajectory and its role in shaping the evolving global energy landscape.
As Tesla continues to dominate headlines with its electric vehicles and ambitious plans for autonomous driving, a less-discussed segment of the company is quietly becoming a potential game-changer. Tesla’s energy business, particularly its energy storage division, is showing signs of becoming a major contributor to the company’s bottom line and future growth prospects.
In a recent production and delivery report, Tesla revealed that it had deployed a record-breaking 9.4 GWh (gigawatt hours) of battery energy storage in the second quarter of 2024. This figure represents more than double the amount deployed in the first quarter, signaling explosive growth in this sector.
Tesla’s energy storage solutions range from residential Powerwall units to utility-scale Megapack installations. A single Powerwall can store enough energy to power a small home for a day, while a Megapack installation boasts the capacity to provide electricity to 3,600 homes for an hour. This scalability allows Tesla to cater to a wide range of customers, from individual homeowners to large utility companies and municipalities.
The financial performance of Tesla’s energy business is equally impressive. In the first quarter of 2024, the segment generated $1.6 billion in revenue and $403 million in gross profit. What’s particularly noteworthy is the gross margin of 24.6%, significantly higher than Tesla’s overall gross margin of 17.4% for the same period. This robust profitability comes at a crucial time for Tesla, as its automotive business faces margin pressure due to recent price cuts aimed at stimulating demand.
Wall Street is taking notice of this shift. Adam Jonas, an analyst at Morgan Stanley, dubbed the Q2 energy deployment figures a “show stealer” and valued Tesla Energy at $36 per Tesla share, or approximately $130 billion. This valuation suggests that the energy business could be a substantial component of Tesla’s market capitalization in the future.
The growth potential for Tesla’s energy storage business is closely tied to broader technological and infrastructure trends. The increasing adoption of artificial intelligence and the subsequent need for more data centers are expected to drive a “multigenerational increase in energy demand,” according to Jonas. This surge in electricity needs, coupled with the ongoing transition to renewable energy sources, positions Tesla’s energy storage solutions as a critical component of future power grids.
Moreover, the Inflation Reduction Act in the United States is likely to accelerate investments in grid infrastructure, potentially creating more opportunities for Tesla’s energy products. As utilities and businesses look to modernize and stabilize the power grid, Tesla’s Megapack installations could play a crucial role in load balancing and ensuring reliable power supply.
While much of the investor focus has been on Tesla’s automotive innovations, including the anticipated launch of a lower-priced electric vehicle and the reveal of its robotaxi concept, the energy business could provide a significant upside surprise in upcoming earnings reports. This diversification of revenue streams may also help to stabilize Tesla’s financial performance, reducing its reliance on the cyclical automotive market.
It’s worth noting that Tesla’s energy business isn’t limited to storage solutions. The company also produces solar roof tiles and conventional solar panels, although these products have received less attention in recent years. As the energy storage business continues to grow, it may create synergies with Tesla’s solar products, offering customers comprehensive energy solutions.
As we approach Tesla’s Q2 earnings report in July 2024, investors and analysts will be keenly watching the performance of the energy storage segment. If the strong deployment figures translate into substantial revenue and profit growth, it could mark a turning point in how the market perceives Tesla – not just as an automaker, but as a diversified energy and technology company.
In conclusion, Tesla’s energy storage business is emerging as a powerful growth driver for the company. With its impressive profit margins, scalable solutions, and alignment with global energy trends, this segment could play a crucial role in Tesla’s future success and valuation. As the world continues its transition to sustainable energy, Tesla appears well-positioned to capitalize on the growing demand for advanced energy storage solutions.
InPlay Oil is a junior oil and gas exploration and production company with operations in Alberta focused on light oil production. The company operates long-lived, low-decline properties with drilling development and enhanced oil recovery potential as well as undeveloped lands with exploration possibilities. The common shares of InPlay trade on the Toronto Stock Exchange under the symbol IPO and the OTCQX Exchange under the symbol IPOOF.
Mark Reichman, Managing Director, Equity Research Analyst, Natural Resources, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Looking ahead. While first quarter production was 5% lower than the prior year period, we expect a stronger second quarter due to wells that went into production in late March and early April and stronger crude oil prices. InPlay plans to drill and bring new production online in the third quarter of 2024 that is focused on high oil-weighted properties. The oil-weighted production from new wells is expected to benefit from higher realized oil prices forecasted for the balance of the year.
Updating estimates. We have increased our 2024 and 2025 EPS estimates to $0.18 and $0.26, respectively, from $0.16 and $0.23. Our estimates reflect modestly higher production in the second and third quarters of 2024 and higher crude oil prices. We forecast adjusted funds flow of $91.0 million in 2024 and $99.4 million in 2025. Depending on the company’s production profile, we think our estimates may prove conservative.
Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.
This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
Mark Reichman, Managing Director, Equity Research Analyst, Natural Resources, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Special dividend. Excluding special dividends, Hemisphere Energy pays a base dividend of C$0.025 per share per quarter, or C$0.10 per share on an annual basis. Hemisphere Energy recently declared a special dividend of C$0.03 per common share. The special dividend will be paid on July 26 to shareholders of record on July 12. In May, the company’s board of directors approved a quarterly cash dividend of C$0.025 per share that will be paid on June 28 to shareholders of record on June 20.
Return of capital to shareholders. To date in 2024, Hemisphere has committed to returning C$10.7 million to shareholders, including shares repurchased and canceled under the company’s normal course bid, quarterly dividend payments in February and June, and the special dividend payment in July. Returns of capital are funded entirely with free cash flow supported by ultra-low decline rates, low operating expenses, low capital-intensive assets, long life reserves and minimal decommissioning liabilities.
Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.
This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
Vancouver, British Columbia–(Newsfile Corp. – June 4, 2024) – Hemisphere Energy Corporation (TSXV: HME) (OTCQX: HMENF) (“Hemisphere” or the “Company”) is pleased to announce that its board of directors has approved the declaration of a special dividend to shareholders.
Given the strong financial position and performance outlook of the Company, Hemisphere is pleased to announce that its board of directors has approved the declaration of a special dividend of C$0.03 per common share. The special dividend is part of Hemisphere’s comprehensive shareholder return model, and will be paid on July 26, 2024 to shareholders of record on July 12, 2024. This special dividend is designated as an eligible dividend for Canadian income tax purposes. It is in addition to the Company’s quarterly base dividend of C$0.025 per common share announced on May 29, 2024, and is in accordance with the Company’s dividend policy.
Hemisphere has committed to shareholder returns of $10.7 million thus far in 2024, including shares repurchased and cancelled under the Company’s normal course issuer bid, two quarterly dividend payments in February and June, and the special dividend payment in July. This return of capital is funded entirely by the Company’s free cash flow and is made possible by its high-margin enhanced oil recovery (“EOR”) assets, ultra-low production decline, and healthy balance sheet.
Subsequent to Hemisphere’s last news release, the Company has now brought online all three producers in its new Marsden, Saskatchewan development play. The purpose of primary production at these wells prior to polymer flood start-up is to gather fluid samples, pressure data, and other relevant reservoir data that will assist in EOR project planning. Construction of Hemisphere’s multi-well battery is currently underway, with anticipated polymer skid delivery and EOR project start-up in the third quarter.
About Hemisphere Energy Corporation
Hemisphere is a dividend-paying Canadian oil company focused on maximizing value per share growth with the sustainable development of its high netback, low decline conventional heavy oil assets through polymer flood EOR methods. Hemisphere trades on the TSX Venture Exchange as a Tier 1 issuer under the symbol “HME” and on the OTCQX Venture Marketplace under the symbol “HMENF”.
For further information, please visit the Company’s website at www.hemisphereenergy.ca to view its corporate presentation or contact:
Don Simmons, President & Chief Executive Officer Telephone: (604) 685-9255 Email: info@hemisphereenergy.ca
Certain statements included in this news release constitute forward-looking statements or forward-looking information (collectively, “forward-looking statements”) within the meaning of applicable securities legislation. Forward-looking statements are typically identified by words such as “anticipate”, “continue”, “estimate”, “expect”, “forecast”, “may”, “will”, “project”, “could”, “plan”, “intend”, “should”, “believe”, “outlook”, “potential”, “target” and similar words suggesting future events or future performance. In particular, but without limiting the generality of the foregoing, this news release includes forward-looking statements including that a quarterly dividend will be paid in June 2024; that a special dividend will be paid to shareholders on July 26, 2024 to shareholders of record on July 12, 2024; and the timing of Hemisphere’s anticipated polymer skid delivery and EOR project start-up in the third quarter.
Forward‐looking statements are based on a number of material factors, expectations or assumptions of Hemisphere which have been used to develop such statements and information, but which may prove to be incorrect. Although Hemisphere believes that the expectations reflected in such forward‐looking statements or information are reasonable, undue reliance should not be placed on forward‐looking statements because Hemisphere can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified herein, assumptions have been made regarding, among other things: the timing for payment of the special dividend; no delays in the anticipated timing for delivery of the polymer skid and EOR project; the general continuance of current industry conditions; the timely receipt of any required regulatory approvals; the ability of Hemisphere to obtain qualified staff, equipment and services in a timely and cost efficient manner; drilling results; the ability of the operator of the projects in which Hemisphere has an interest in to operate the field in a safe, efficient and effective manner; the ability of Hemisphere to obtain financing on acceptable terms; field production rates and decline rates; the ability to replace and expand oil and natural gas reserves through acquisition, development and exploration; the timing and cost of pipeline, storage and facility construction and expansion and the ability of Hemisphere to secure adequate product transportation; future commodity prices; currency, exchange and interest rates; regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which Hemisphere operates; and the ability of Hemisphere to successfully market its oil and natural gas products.
The forward‐looking statements included in this news release are not guarantees of future performance and should not be unduly relied upon. Such information and statements, including the assumptions made in respect thereof, involve known and unknown risks, uncertainties and other factors that may cause actual results or events to defer materially from those anticipated in such forward‐looking statements including, without limitation: changes in project timelines and workstreams; changes in commodity prices; changes in the demand for or supply of Hemisphere’s products, the early stage of development of some of the evaluated areas and zones; unanticipated operating results or production declines; changes in tax or environmental laws, royalty rates or other regulatory matters; changes in development plans of Hemisphere or by third party operators of Hemisphere’s properties, increased debt levels or debt service requirements; inaccurate estimation of Hemisphere’s oil and gas reserve volumes; limited, unfavourable or a lack of access to capital markets; increased costs; a lack of adequate insurance coverage; the impact of competitors; and certain other risks detailed from time‐to‐time in Hemisphere’s public disclosure documents, (including, without limitation, those risks identified in this news release and in Hemisphere’s Annual Information Form).
The forward‐looking statements contained in this news release speak only as of the date of this news release, and Hemisphere does not assume any obligation to publicly update or revise any of the included forward‐looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.
BATAVIA, N.Y.–(BUSINESS WIRE)– Graham Corporation (NYSE: GHM) (“GHM” or “the Company”), a global leader in the design and manufacture of mission critical fluid, power, heat transfer, and vacuum technologies for the defense, space, energy, and process industries, today announced that it has received approximately $17 million of orders for two expansion projects in the energy and petrochemical markets.
Daniel J. Thoren, President and CEO, commented, “We are excited to work with our North American customer as they aim to create the world’s first net-zero carbon emissions integrated ethylene cracker and derivatives site. Graham’s surface condensers with custom venting package allow the turbine drives to operate at peak efficiency and are considered state of the art in our industry. Additionally, we received a notable order to support an expansion project in the Middle East, which we attribute to our strong relationship and our customer’s preference for our high-performance steam jet ejectors.”
The North American order includes three surface condenser systems for critical service in both a main process unit and utility unit. This project aims to advance the eco-friendliness of natural gas refining, with the collective goal to minimize carbon emissions throughout the production process. The order was received in April 2024 and approximately 50% of the revenue is expected to be recognized in fiscal 2025 with the remainder expected in fiscal 2026.
For the Middle East expansion project, the Company was awarded a contract to supply a new vacuum system for a crude to chemical vacuum distillation tower. This project aims to bolster the production of Group II and Group III Base Oils. This order was received in March 2024, with revenue expected to be recognized in fiscal 2025.
About Graham Corporation
GHM is a global leader in the design and manufacture of mission critical fluid, power, heat transfer and vacuum technologies for the defense, space, energy and process industries. The Graham Manufacturing and Barber-Nichols’ global brands are built upon world-renowned engineering expertise in vacuum and heat transfer, cryogenic pumps and turbomachinery technologies, as well as its responsive and flexible service and the unsurpassed quality customers have come to expect from the Company’s products and systems.
Graham Corporation routinely posts news and other important information on its website, www.grahamcorp.com, where additional information on Graham Corporation and its businesses can be found.
Safe Harbor Regarding Forward Looking Statements
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are subject to risks, uncertainties and assumptions and are identified by words such as “aims,” “expects,” “anticipates,” “potential,” and other similar words. All statements addressing operating performance, events, or developments that Graham Corporation expects or anticipates will occur in the future, including but not limited to, winning potential future or multi-year orders, potential revenues and timing of such revenues, capacity, demand growth, and delivering timely or otherwise on schedule are forward-looking statements. Because they are forward-looking, they should be evaluated in light of important risk factors and uncertainties. These risk factors and uncertainties are more fully described in Graham Corporation’s most recent Annual Report filed with the Securities and Exchange Commission, including under the heading entitled “Risk Factors,” its quarterly reports on Form 10-Q, and other filings it makes with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize or should any of Graham Corporation’s underlying assumptions prove incorrect, actual results may vary materially from those currently anticipated. In addition, undue reliance should not be placed on Graham Corporation’s forward-looking statements. Except as required by law, Graham Corporation disclaims any obligation to update or publicly announce any revisions to any of the forward-looking statements contained in this news release.
