Westport Fuel Systems works to develop clean transportation technology. The company engineers and produces natural gas engines, as well as fuel system components for passenger cars and commercial vehicles. Furthermore, it is a leader in high-pressure direct injection technology, which is also known as HPDI.
The company suffered severely due to the coronavirus pandemic. Its Italian manufacturing facility was forced to shut down and hasn’t resumed operations until May 4. Analysts expect stock to report a first-quarter net loss of 5 cents per share in June.
However, Westport gained significantly in 2019, with its revenues and earnings rising. Revenues skyrocketed by 23% year-over-year in the fourth quarter, reaching $74.3 million. And the stock managed to break-even EPS in the fourth quarter, while experts predicted a 1-cent loss. Comparatively, Westport experienced an 8-cent loss quarterly during the previous year.
How much could investors gain with this stock?
The stock’s average price is $3.33 per share currently. And it has a 242% gain potential. Westport is declining to provide guidance right now, due to the coronavirus uncertainty, and navigates lower volumes instead, with compressed margins. But Colin Rusch, Oppenheimer’s analyst, believes that the company can weather the current crisis. Rusch has given the company’s shares a $3 price target, with a 209% upside potential for the next 12 months.
Furthermore, Eric Stine, Craig-Hallum’s analyst, thinks that the company will receive support from governments in Europe and Canada. He outlined why the company has a strong future ahead. According to Stine, Westport Fuel Systems is at very early stages of a meaningful growth ramp as straightforward economics are shifting to alternative fuels. The stock has already gained a competitive advantage.
Stine gave Westport a strong-buy rating. He set his price target at $5 per share for the stock. The analyst’s target implies an impressive one-year upside potential of 415%.
