Small Cap Strategist is published by Crystal Equity Research an independent research resource on small capitalization stocks. Follow along as we discuss the most recent trends in the small-cap sector, investigate interesting companies and pan a few not-so-promising stocks.
Last week Lime Energy
reported exceptional sales growth in the quarter ending June 2015.Revenue from the company’s energy efficiency
solutions was $32 million, increasing and impressive 135% compared to a year
ago.Sales were boosted beginning by the
March 2015 acquisition of EnerPath, a provider of software solutions for
utility energy efficiency.However,
several of the company’s utility programs were expanded and that drove organic
sales as well. Is it time to give Lime some new respect?
In the renewable
energy sector, efficiency programs are often overlooked as a contributor to
climate and energy relief.Lime Energy made
its bones in the efficiency sector with programs for small- and medium-sized businesses
to save on the cost of lighting, space heating and cooling, equipment operation
and water heating.The acquisition of
EnerPath gives the company a bigger stake in utility-based programs.
Sales in the
twelve months ending March 2015, were $64.8 million, resulting in a net loss of
$5.3 million or $1.01 per share.On its
own Lime Energy had yet to achieve profitability.What is more, operations still required cash
resources.The quarter ending June 2015,
was the first quarter that EnerPath contributed for the full period.Thus it appears the company’s new annual revenue
run-rate is around $124 million.In the
June quarter the combined companies reported a small operating profit and
earnings adjusted for non-cash expenses was a respectable 5.3% of sales.It appears that EnerPath brings a more
effective operating structure to Lime.
Lime Energy is a
small company with a market cap of $35.5 million and trading volume in its
stock is only about 10,000 share per day.It has been overlooked as a investment in the modern energy industry. LIME trades at 0.6 times sales, which could be
a bargain for a company that just doubled in size.It is also very interesting for an operation that
is approaching profitability.
Neither the author of the Small Cap Strategist web
log, Crystal Equity Research nor its affiliates have a beneficial interest in
the companies mentioned herein.