GNE - Genie Energy: Still Deeply Undervalued Despite Price Increase

2024-02-15 07:52:03 ET

Summary

• Revenue rising through marketing and acquisitions, not just cost-cutting.
• Genie Energy is investing in renewable energy with long-term growth trends.
• Recent improvement in Cash Conversion Cycle suggests progress, but needs to be monitored for long-term sustainability.
• Genie Energy stock is undervalued compared to peers, meaning it is ideal for "deep value play" investors.

Investment Thesis

I wrote about Genie Energy Ltd. ( GNE ) almost one year ago. Back then, I noted the stock was deeply undervalued, which presents a good 'value play' opportunity. Since my last coverage, the price has appreciated significantly, close to 50%. In my opinion, as this appreciation was supported by a favourable improvement in the financial profile, the stock is still fundamentally undervalued.

GNE's recent revenue growth was mainly driven by marketing and customer acquisition, not just cost-cutting, as noted in my previous article....

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