ENVX - Enovix: Epic Rally But Company Remains A Show-Me Story

2024-05-02 21:00:14 ET

Summary

• Enovix Corporation's heavily shorted shares rallied by 45% after the company disclosed a battery development agreement with a leading smartphone OEM.
• Management also reiterated plans for initial sample production and subsequent volume manufacturing at its new facility in Malaysia.
• However, production equipment still requires final acceptance testing and timelines appear aggressive.
• While the company is taking measures to reduce cash burn, cash outflows are likely to remain elevated for the next couple of quarters, thus increasing the risk for an equity raise next year.
• Reiterating "Sell" on elevated risk of the company falling short of its ambitious targets.

Note:

I have covered Enovix Corporation or "Enovix" ( ENVX ) previously, so investors should view this as an update to my earlier article on the company. ...

For further details see: