EnSync, Inc. – ESNC (Watchlist?)

The prospect of solar power, a renewable resource for the next 4 or 5 billion years as long as there are humans left to use it, is an industry that is projected to triple in size over the next few years. This is according to the SEIA or Solar Energy Industries Association. This anticipated growth presents a great opportunity to find a well-managed and established company that can capitalize on this trend. Which brings me to EnSync Energy Systems (symbol ESNC). The small cap ESNC is one of many companies driven to enable its customers to harness solar energy, manage it, and distribute their excess collection of power into the power grid. The company describes itself as “a leading developer of innovative distributed energy resource (DER) systems and Internet of Energy (IoE) control platforms for the utility, commercial, industrial and multi-tenant building markets.”

One of the many things that has brought me to this company, like my other picks, is its technological potential. Tech that’s integrated with its products and is considered at the forefront in the industry. So much so that it has caught the interest of the much larger Schneider Electric. The company recently announced a collaboration agreement with Schneider to explore DER market opportunities. It will certainly be interesting to hear the full details or potential outcome of this agreement.

I have not started a position in EnSync, Inc., but am certainly keeping it on my watchlist. According to the latest quarterly report, they have cash on hand of $12.4 million, however the recent cash raise suggests it was not enough to support the financing of the new recent projects. Selling shares may be the option of choice for the company further depressing value which leads me to a sit and wait approach. Looking at the possible growth trajectory, factoring in the recent power purchase agreements (PPA’s), the partnership with Schneider Electric, and general growth of solar markets, I expect to see an increase of more than 100% in share price over the next couple years. Timing here is key. More details to come…