FTC Solar (FTCI) double upgraded to Buy at Bank of America
By Senad Karaahmetovic
Bank of America analysts upgraded shares of FTC Solar (NASDAQ:) to Buy from Underperform with the price target raised to $3.50 from the prior $2 per share.
While the analysts note that Street confidence is “limited,” they still see a runway to a recovery in volumes and margins. Moreover, BofA is growing more positive on the company’s cost control, given discipline/stability through a product launch and ramp cycle.
“We see a nominally modest improvement in FTCI’s revenue, we model significant GM accretion because of fixed cost coverage. Given FTCI’s very muted topline throughout 2022, given UFLPA-induced module supply challenges, the nominally modest step up in revenues we model throughout 2023 and 2024 is highly accretive to FTCI’s gross and EBITDA margin profile,” they wrote in a client note.
“Despite the execution risk ahead, we see backlog momentum as a leading indicator of revenue, and critically meaningful margin inflection. While clearly high risk, we see outsized return potential as well,” the analysts concluded.
FTCI shares trade 10% lower today.
