Weekly Update 23
Our take on PESI, IPWR, VSTI and a more extensive take on RELL. Which ones can you still buy?
Perma-Fix (PESI)
Q1 was ugly, in fact so ugly that the company had to resort to additional $20M financing at $8.75. The shares recovered a bit on Friday, and this is now in the rearview mirror.
Looking forward, H2 should be much better with one of potentially 4 revenue streams from Hanford (the largest nuclear waste site in the US) ramping ($4M+ per quarter and a second (TRU waste) and third (EMF waste) stream coming online in May and June, respectively.
The company submitted a $4B contract for the fourth stream (grouting), for which it’s very well positioned, as nobody wants to transport liquid nuclear waste out of state, but this will take years to develop.
Other opportunities are the decommissioning of the USS Enterprise aircraft carrier, expected to be awarded in June, where PESI is part of a consortium with three other bidders for the project.
Its PFAS destruction business completed a 1.5 K-gallon DOE project that serves as a future marker for the DOE. It also secured a win in Arizona for removing firefighting foam (loaded with PFASs), and the company is proceeding with building its second-generation 2K gallons per shift facility.
It’s been a long wait, but H2/26 and especially FY27 should be a whole lot better.
Verdict: Buy at $10.
