Inventergy Global Inc (OTCMKTS:INVT) has made several announcements in recent months, revealing actions that would continue to push its share price higher. For example, the company has ventured into the multibillion-dollar solar energy industry with a deal that allows it to commercialize a transformative solar panel mounting innovation.
In this review of Inventergy, we analyze the solar energy venture and other developments that we think provide conducive atmosphere to the company’s stock price to continue rising. More details on this coming shortly. First, have a look at Inventergy’s share price action.
Inventergy engages in monetization of intellectual property, or IP. It acquires rights to patented technologies and then it licenses the technologies to companies that need them to create products, render services or achieve some other goals.
Inventergy holds rights to a large portfolio of telecom IP that cover areas such as core network infrastructure and mobile broadband communications. The portfolio includes hundreds of patents acquired from prominent telecom innovators such as Nokia Oyj (ADR)(NYSE:NOK), Huawei and Panasonic. Inventergy is headquartered in California.
In its 2Q17 financial scorecard, Inventergy reported a net profit of $39.7 million, or $2.99 per share. The report impressed the market considering that Inventergy had suffered a net loss of $2.0 million, or $0.44 per share, in a similar quarter last year.
Not only did Inventergy’s bottom line improve tremendously in 2Q17, the company’s balance sheet also grew stronger. The company said it extinguished $40.8 million in debt thanks to a debt restructuring that it completed earlier this year. The debt restructuring helped Inventergy to cut its quarterly operating expenses in 2Q17 due to lower interest costs.
Here’s what Inventergy CEO Joe Beyerssaid about the 2Q17 performance:
“This past quarter we remained focused on strengthening our corporate and capital structure. These initiatives are important to us as they created financial flexibility that enable us to reinvest in our business to generate greater shareholder returns.”
In a move that could put the stock in a long-term upward rally, Inventergy announced on August 2 that it had entered into an agreement to acquire rights to a technology tied to innovative solar panel mounting.
It didn’t disclose the innovator it was acquiring the patent from, but it said that the deal would hand it rights to commercialize the unique solar panel mounting technology across the solar industry.
Inventergy said the solar panel mounting technology it was acquiring can help lower mounting costs by up to 50%. Additionally, Inventergy said the innovation enables installation of panels in locations where it would be impossible or costs would be prohibitive without it.
Floating solar plants are some of the most complex solar installations, yet they could be the only viable option in some regions. In floating solar plants, solar panels are installed at sea or in internal water bodies. Where solar farms would cover an expansive real estate, floating solar plants are preferable to free land for other uses or reduce land cost.
The rising demand for renewable energy and the need to use land prudently is fueling the adoption of floating solar plants, especially in countries that don’t have much land for traditional solar farms.
Inventergy didn’t reveal whether the innovation it was acquiring could be used in floating solar plants installations. But its description of the innovation suggests that it could fit the bill in complex installations such as floating solar plants.
As such, Inventergy could capitalize on floating solar plants market, where revenue opportunity is appealing going by market projections. According to Grand View Research, global floating solar panels market will hit $2.7 billion by 2025, compared to $13.8 million in 2015.The overall global solar power market is projected to grow to $137 billion by 2020, from $60 billion in 2013, according to a report by consulting firm Frost & Sullivan.
About the agreement that will allow Inventergyto commercialize a unique solar panel mounting technology, Inventergy CEO Joe Beyers had this to say:
“This agreement allows us to participate in the rapid growth of the solar industry and retains a share of the technology’s value potential. We are always very excited when selected to represent companies who bring disruptive technologies to the market.”
In another exciting update, Inventergy announced on August 17 that members of its board of directors had committed to inject an additional capital of $100,000 in the company. To understand the potential impact of this capital injection, we will look at the nature of the financing and its purpose.
According Inventergy, the financing from the directors is non-dilutive on the stock. In other words, the funding will not water down the value for existing Inventergy shareholders, like a traditional equity or convertible notes fundraising would do.
The financing will be used byInventergy to fund its operations. As such, in addition to the debt restructuring, the financing goes a long way to giveInventergygreater financial flexibility.
From venturing into solar power industry to non-dilutive fundraising to debt restructuring, Inventergy has made smart moves that create a favorable atmosphere for the stock to make more upward moves.
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Disclosure: We have no position in INVT and have not been compensated for this article.