“Don’t Just Watch This Tornado – Buy It” is the title of Beacon Securities initiating coverage from analyst Russell Stanley on Tornado Global Hydrovacs, a designer and manufacturer of hydrovac trucks.
Mr. Stanley has set a stock price target of $1.00/share compared to the current trading range of $0.40 to $0.45.
He writes that hydrovac adoption has lots of runway as there is a growing need for safe excavation around critical infrastructure and in congested underground conditions. He believes there will be significant demand over the next 10 years as increased public infrastructure investment should support improved adoption.
He states that “Tornado is unique, underfollowed pureplay on that demand” and has forecast 2022 revenues of $60 million and EBITDA of $6 million. Year end results will be released in April.
Mr. Stanley is calling for revenues of $91 million and EBITDA of $13 million in 2023 and $124 million in revenues and $20 million EBITDA in 2024. There are 133 million shares issued and 143 million fully diluted. Insiders own 46% of issued shares.
Importantly, he writes that, “We also believe that Tornado would be a worthy acquisition target for heavy equipment manufacturers looking to establish or add to their hydrovac manufacturing capabilities.”
Mr. Stanley’s highly detailed 30+ page research report even notes that “Given Tornado’s growth outlook we doubt it will be long before it receives additional research coverage.”
To appreciate the importance of safe excavation, look at the below picture.
To watch a corporate video on Tornado, click here: Tornado Global Hydrovacs 2022
To view the corporate presentation: Tornado Global Hydrovacs Presentation