Enviva Partners (EVA) has priced an upsized public offering of 4,400,000 common shares. Gross proceeds from the offering are expected to be approximately $200.2 million.
Enviva is the world’s largest producer of sustainable wood pellets, a renewable alternative to coal.
The underwriters have been granted a 30-day option to purchase up to an additional 525,000 common shares for a total amount of approximately $23.9 million.
The offering, subject to fulfillment of customary closing conditions, is expected to close on June 8, 2021.
Net proceeds from the offering will be used to fund pending acquisitions. (See Enviva stock analysis on TipRanks)
On April 28, Enviva Partners reported a Q1 loss of $0.27 per share, compared to the $0.23 earnings per share estimated by analysts. Revenue surged 17.9% to $241 million and surpassed the consensus estimate of $240.5 million.
Following the earnings announcement, Raymond James analyst Pavel Molchanov maintained a Buy rating and a price target of $57 (18.1% upside potential).
Molchanov commented, “Given the global adoption curve of wood pellets, and assuming one asset dropdown per year, we envision medium-term EBITDA growth in the low teens.”
Consensus among analysts is a Strong Buy based on 3 unanimous Buys. The average analyst price target stands at $60.33 and implies upside potential of 25% to current levels. Shares have gained almost 37.2% over the past year.
Enviva Partners scores a 9 of 10 from TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.
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