ATOME PLC (AIM:ATOM) offers investors the opportunity for ‘multiples’ of growth as its flagship project advances, according to analysts at Stifel.
The AIM-listed company, which is developing the Villeta green fertiliser project in Paraguay, this week also launched a new complementary renewable energy business unit, ATOME Power, to assess a ‘utility scale’ (400MW) solar plant.
At the same time, ATOME told investors it is continuing to progress Villeta toward its final investment decision (anticipated potentially as soon as mid-summer, or slightly later).
Stifel has a ‘buy’ recommendation and pitches a 130p price target, compared to today’s market price of around 37p per share.
The stockbroker highlighted that, whilst still at a formative stage, the ATOME Power business has potential.
“ATOME POWER would represent a new independent revenue stream, which is being enabled by growing power demand in Paraguay and a desire for the country to diversify its renewable power away from hydro,” the broker said in a note.
“Funding will be provided through internal resources and/or external parties at a project level without any equity funding at the group so this feels like a nice option that builds on expertise and relationships in the region, without diverting resources from the core of the business.”
ATOME chief executive Olivier Mussat, meanwhile, said the power business would described the opportunity as deliver substantial, near-term, diversified revenue without diverting critical resources from the firm’s core operations.
"Our new power business plans to capitalise on ATOME's established relationships to enable accelerated project deployment and unlock expansion opportunities within Paraguay and across the region,” he said in Monday’s statement.