What happened 

Shares of renewable energy stock Orbital Energy Group (NASDAQ:OEG) jumped as much as 21.5% on Wednesday after announcing a new solar project. At 11:15 a.m. EDT today, shares were up 15.4% and holding steady for the day. 

So what

Orbital Energy Group's subsidiary Orbital Solar Services was selected to be the engineering, procurement, and construction (EPC) provider for a 137 megawatt project in Arkansas. The end customer wasn't named, only that it is a North American Fortune 100 energy company.

Image source: Getty Images.

The total project is expected to have a value of over $64 million and is due to be delivered in early 2022. This is a significant project when put into context of the $9.5 million in revenue generated in the first quarter of 2021 and the $62.1 million in backlog at the end of that quarter. 

Now what

This is certainly a big contract win for Orbital Energy Group given the company's current revenue and backlog. What we don't yet have a good feel for is how profitable the company can be from projects like this. Last quarter, it lost $18 million, and it'll need to grow revenue sharply to get out of that hole.

This is a step in the right direction, but until Orbital becomes profitable, this is a highly competitive portion of the solar market that I'll stay out of.  

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This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

Travis Hoium has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.