First Berlin Equity Research has published a research update on tubesolar AG (ISIN: DE000A2PXQD4). Analyst Dr. Karsten von Blumenthal reiterated his BUY rating and increased the price target from EUR 7.50 to EUR 7.80.
The certification of its innovative photovoltaic thin-film tube modules by TÜV Rheinland is a significant milestone for tubesolar. The company plans to commission its first highly automated production line (20 MW) before the end of the current year. By the end of 2025, tubesolar plans to increase production capacity to 250 MW. The distinctive design of tubesolar’s patented technology is a unique selling point that gives the company a clear competitive advantage over traditional flat modules in both the agri-photovoltaic and green roof sectors. tubesolar published its 2021 annual report and 2022 half-year report in September and October respectively. As expected, the company did not generate any revenue in 2021 or in the first half of 2022. Net income was €-1.7m in 2021 and €-1.8m in H1/22. For both 2022E and 2023E, tubesolar expects negative EBIT in the low double-digit million euro range, not taking own work and investment grants into account in either year. We have adjusted our estimates for 2022E and subsequent years. An updated DCF model, which accounts for the reduced risk after certification via a lower WACC estimate (10.9% vs. 12.1%), results in a new price target of €7.80 (previously: €7.50). We confirm our Buy recommendation.