Aspen Aerogels surged early Wednesday after announcing it received a "conditional commitment" from the U.S. Department of Energy for a loan of up to $670.6 million to build its planned second manufacturing facility.
The company also reported preliminary third-quarter financial results early Wednesday, with revenue increasing more than 90% to around $117 million and a net loss of about $13 million. Aspen Aerogels ended the third-quarter with cash and cash equivalents of approximately $113 million.
Analysts had expected Q3 revenue of $95.1 million.
Chief Executive Donald Young said Wednesday that the proposed government loan "would fully fund the required capex for our second aerogel manufacturing facility, which is expected to play a key role in scaling our PyroThin supply for our rapidly growing Thermal Barrier business."
Aspen Aerogels manufactures gel-based insulation used primarily in the energy infrastructure and building materials markets. However, Aspen Battery Materials, the company's carbon aerogel segment, aims to increase the performance of lithium-ion battery cells to enable EV manufacturers to extend the driving range and reduce EV costs.
Aspen Aerogels has production contracts with General Motors to supply fabricated multipart thermal barriers for use in the battery system of next-generation EVs. It also has entered into thermal barrier production contracts with Toyota and a battery cell joint venture between Stellantis, TotalEnergies and Mercedes-Benz, and Volkswagen Group-owned Audi.
The company's products are also currently used by myriad energy businesses. Customers include Exxon Mobil, NextEra Energy and TechnipFMC, according to Aspen Aerogels regulatory filings.
Aspen Aerogels Stock
ASPN stock jumped more than 13% to 25.43, hitting an intraday high of 26.90, in Wednesday market action, rebounding back above the 50-day line. Shares have gained more than 40% in 2024, but are volatile. Aspen Aerogels stock had fallen more than 18% in October heading into Wednesday's open but recently found support at its 200-day moving average, according to MarketSurge chart analysis.
The company reports finald third-quarter earnings and revenue on Nov. 7. In early August, Aspen Aerogels announced Q2 EPS came in at 21 cents, up from a 22-cents-per-share loss a year ago. The company's revenue ballooned 144% to $117.8 million. Analysts expected earnings of 5 cents per share and sales of around $101 million.
ASPN increased its 2024 outlook in August. The outfit predicts revenue around $390 million and earnings of 9 cents per share. The company's previous view was for $380 million in sales and EPS of 3 cents.
Aspen Aerogels on Aug. 19 reported that it secured a $125 million term loan and a $100 million revolving credit facility with MidCap Financial. At the time, the company said it hopes to reduce its cost of capital and provide financing flexibility.
The stock has a 76 Composite Rating out of a best-possible 99. ASPN also has a strong 96 Relative Strength Rating and a 75 EPS Rating.
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