Fluence Gets New Bull Amid Margin Expansion

Dow Jones
Aug 03

0145 GMT - Fluence gets a new bull at Bell Potter, where analyst Ritesh Varma points to expanding margins and potential valuation upside at the water-management tech provider. Raising his recommendation to speculative buy from speculative hold, Varma writes in a note that the Australia-listed company has demonstrated an ability to grow its higher-margin divisions. He points out that first-half gross margin rose to 35.5% from 26.8% a year earlier, while first-half Ebitda was the company's strongest in at least five years. The first half is typically softer than the second half due to customer order patterns, he adds. Varma hasn't included the potential award of an operations and maintenance contract in Ivory Coast, which he thinks could provide valuation upside. Target price remains 11 Australian cents. Shares are up 2.6% at A$0.08.

 

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