ASPN - Why Shares in EV Materials Company Aspen Aerogels Soared This Week
Shares in advanced materials company Aspen Aerogels (NYSE: ASPN) were up nearly 13% on the week as of trading on Thursday afternoon. The move comes down to a positive business update given on Monday. Investors were left excited after positive order news in its two key end markets. As a manufacturer of silica aerogel products (air is trapped between silica solids to create thermal insulation), Aspen has key customers in the energy infrastructure market. However, its exciting growth prospects come from thermal barriers used in the battery packs of e lectric vehicles (EVs) and energy storage.
The update called for a significant upgrade to revenue expectations on the back of good order growth from Toyota and General Motors :
In short, the update is everything investors might want to hear from a small-cap growth company. Aspen is loss making, and the increased investments will increase cash outflows. Management ramped the high end of its capital expenditure expectations by $25 million, and it now stands at $250 million to $300 million. That said, there's nothing wrong with investing for growth, and Toyota and General Motors are significant players in the automotive and EV market.
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Why Shares in EV Materials Company Aspen Aerogels Soared This Week