Please ensure Javascript is enabled for purposes of website accessibility

Why Orbital Energy Group's Shares Popped 37.1% Today

By Travis Hoium - Jan 26, 2021 at 3:01PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

A potentially big agreement is pushing Orbital's shares higher.

What happened 

Shares of Orbital Energy Group (OEG 3.83%) jumped as much as 37.1% in trading Tuesday after the company announced a new partnership. Shares were up 16.9% at 3:25 p.m. EST. 

So what

Orbital announced an engineering, procurement, and construction (EPC) agreement with the newly formed Black Sunrise Half Century Fund. The fund is decommissioning coal-fired power plants across the U.S. and converting them to solar energy. Management expects the partnership to begin providing services in the second quarter of 2021. 

Solar farm with a setting sun in the background.

Image source: Getty Images.

This is a sizable agreement considering the Black Sunrise Fund expects to build over 1 gigawatt of solar power plants with its initial investment of $725 million. It'll take time to build out these projects, but they'll deliver revenue for many years for Orbital Energy Group. 

Now what

This is an important contract for a company as small as Orbital Energy Group that is trying to establish itself as a preferred EPC company for developers. The company generated just $13.6 million in revenue during the third quarter and lost $5.7 million. If it can win more deals like this and increase recurring revenue, this could be a great performing renewable energy stock. 

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Orbital Energy Group Stock Quote
Orbital Energy Group
OEG
$0.77 (3.83%) $0.03

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
336%
 
S&P 500 Returns
115%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 06/26/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.