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NET Power (NPWR)
NYSE:NPWR
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NET Power
(NYSE:NPWR)
43Neutral
Positive Factors
Liquidity and Strategic Partnerships
There is an attractive entry point as there is ~$533M of liquidity, ~3 years of runway, and well-resourced partners that can position the company to pursue large power generation.
Strategic Partnerships
Longer-term oriented strategic partners may do a follow-on to keep the company mission alive, with ~3 years of liquidity to work with to raise capital.
Negative Factors
Funding Challenges
There is a $600-900M funding shortfall for Project Permian, and securing this financing is crucial for the project's final investment decision.
Project Cost Increases
Rising cost estimates for Project Permian are mainly driven by higher natural gas purification costs, transportation costs, labor costs, and cooling system costs.
Stock Performance
NPWR stock was down ~60% likely on cost inflation and new liquidity concerns.
NET Power (NPWR) vs. S&P 500 (SPY)
Market Cap
$535.37M
Dividend YieldN/A
Average Volume (3M)1.66M
Price to Earnings (P/E)43.6
Beta (1Y)0.66
Revenue Growth100.00%
EPS Growth68.51%
CountryUS
Employees68
SectorIndustrials
Sector Strength70
IndustryIndustrial - Machinery
Share Statistics
EPS (TTM)-0.65
Shares Outstanding77,062,770
10 Day Avg. Volume914,187
30 Day Avg. Volume1,655,071
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)2559.31
Price to Cash Flow (P/CF)-12.30
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$4.50Price Target Upside93.13% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
NET Power Business Overview & Revenue Model
Company DescriptionNET Power (NPWR) is a pioneering energy technology company focused on revolutionizing the power industry with its innovative approach to zero-emissions natural gas power generation. The company operates within the clean energy and power generation sectors, offering its proprietary technology that aims to produce low-cost, reliable, and environmentally friendly electricity. NET Power's core product is its natural gas-fired power plants, which utilize a novel process to generate electricity while capturing and sequestering carbon dioxide emissions.
How the Company Makes MoneyNET Power makes money primarily through the licensing and deployment of its proprietary power plant technology, which enables the generation of electricity with zero emissions. The company's revenue model includes licensing fees from partners and clients who build and operate power plants using NET Power's technology. Additionally, it earns revenue through strategic partnerships and collaborations with energy companies and utilities that are interested in adopting clean energy solutions. These partnerships often involve joint ventures or agreements for the development and commercialization of NET Power's technology, contributing to its earnings.
NET Power Financial Statement Overview
Summary
NET Power has shown potential for growth with increased revenue, but faces persistent negative profitability and cash flow challenges. The company's strong equity position provides some financial stability, yet improvements in profitability and cash management are essential for future success.Income Statement
NET Power has experienced inconsistent revenue growth, with a marked increase in total revenue from 2023 to 2024. However, the company has struggled with negative net income and gross profit margins over multiple years, indicating ongoing profitability challenges. The negative EBIT and EBITDA margins further highlight the operational inefficiencies that need addressing.30
Negative
Balance Sheet
The company maintains a solid equity base with a high equity ratio, suggesting financial stability. However, the negative net income has led to low return on equity (ROE), which indicates inefficient use of equity capital. The debt-to-equity ratio remains low, suggesting low leverage and potential for future borrowing if needed.55
Neutral
Cash Flow
While NET Power has improved its free cash flow position from 2023 to 2024, the operating cash flow remains negative, which is concerning for long-term sustainability. The free cash flow to net income ratio is unavailable due to negative net income, which complicates the assessment of cash flow efficiency.45
Neutral
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 0.00 | 250.00K | 175.00K | 580.00K | 2.10M | 45.00K | Gross Profit |
| -40.11M | 219.00K | -50.67M | -13.08M | 1.27M | 8.00K | EBIT |
| -117.90M | -181.32M | -131.96M | -5.92M | -697.13K | -36.40M | EBITDA |
| -76.36M | -99.70M | -130.86M | -36.60M | -10.19M | -23.39M | Net Income Common Stockholders |
| -19.48M | -49.16M | -77.23M | 4.07M | -9.80M | -36.40M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 636.93M | 429.23M | 636.93M | 1.63M | 2.57M | 12.78M | Total Assets |
| 2.47B | 2.29B | 2.47B | 351.85M | 348.37M | 107.08M | Total Debt |
| 2.15M | 3.10M | 2.15M | 786.00K | 7.01M | 0.00 | Net Debt |
| -534.77M | -326.13M | -534.77M | -841.88K | 4.44M | -12.78M | Total Liabilities |
| 142.30M | 131.93M | 140.14M | 41.57M | 42.32M | 8.50M | Stockholders Equity |
| 785.01M | 2.16B | 785.01M | 310.51M | 306.44M | 98.58M |
| Cash Flow | Free Cash Flow | ||||
| -59.78M | -100.30M | -60.65M | -972.53K | -1.33M | -25.20M | Operating Cash Flow |
| -41.04M | -31.65M | -49.00M | -857.53K | -1.33M | -24.98M | Investing Cash Flow |
| -206.94M | -168.67M | -103.70M | -115.00K | -345.03M | -220.00K | Financing Cash Flow |
| 319.56M | -4.93M | 335.39M | 21.47M | 348.93M | 29.00M |
NET Power Technical Analysis
Negative
2.33
Price Trends
5.39
Negative
8.02
Negative
8.24
Negative
Market Momentum
-1.14
Negative
20.56
Positive
17.56
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NPWR, the sentiment is Negative. The current price of 2.33 is below the 20-day moving average (MA) of 2.70, below the 50-day MA of 5.39, and below the 200-day MA of 8.24, indicating a bearish trend. The MACD of -1.14 indicates Negative momentum. The RSI at 20.56 is Positive, neither overbought nor oversold. The STOCH value of 17.56 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NPWR.
NET Power Risk Analysis
NET Power disclosed 69 risk factors in its most recent earnings report. NET Power reported the most risks in the “Tech & Innovation” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
NET Power Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
67 Neutral | $742.24M | 229.74 | 2.39% | ― | 46.42% | ― | |
62 Neutral | $7.50B | 12.89 | 3.19% | 3.38% | 3.64% | -14.27% | |
58 Neutral | $515.15M | 7.02 | 225.91% | ― | 3.70% | 163.07% | |
45 Neutral | $18.68M | ― | -161.00% | ― | -54.59% | -504.44% | |
43 Neutral | $535.37M | 43.62 | -6.83% | ― | 100.00% | 68.51% | |
41 Neutral | $32.40M | ― | 29.28% | ― | -30.29% | 40.03% | |
35 Underperform | $917.18M | ― | -17.34% | ― | ― | ― |
* Industrials Sector Average
Performance Comparison
NPWR
NET Power
2.33
-7.82
-77.04%
AMSC
American Superconductor
18.00
5.52
44.23%
BW
Babcock & Wilcox Company
0.30
-0.75
-71.43%
PSIX
Power Solutions
22.93
20.71
932.88%
CETY
Clean Energy Technologies
0.40
-1.23
-75.46%
NNE
Nano Nuclear Energy Inc.
23.27
18.22
360.79%
NET Power Earnings Call Summary
Earnings Call Date: Mar 10, 2025 | % Change Since: -66.38% | Next Earnings Date: May 19, 2025
Earnings Call Sentiment Neutral
Net Power made significant technological progress, such as completing FEED and successful equipment validation, and maintained a strong liquidity position. However, the company faces challenges with increased project costs, delayed timelines, and securing sufficient capital. Strategic partnerships and licensing opportunities provide potential paths forward.Highlights
Completion of FEED for Project Permian
Net Power completed the front-end engineering and design (FEED) for Project Permian, marking a major milestone for the world's first utility-scale fully integrated clean gas power plant.
Successful Equipment Validation with Baker Hughes
Net Power and Baker Hughes achieved successful ignition on demand and accumulated over 140 fired hours at the La Porte demonstration facility.
Strong Liquidity Position
Net Power closed 2024 with $533 million in cash, cash equivalents, and investments, indicating a strong position to continue advancing technology and plant designs.
Strategic Partnerships and Licensing Opportunities
Collaboration with Baker Hughes and Woodside to develop an industrial-scale Net Power solution for smaller applications, opening new licensing opportunities with minimal capital outlay.
Lowlights
Increased CapEx for Project Permian
The estimated total installed cost for Project Permian increased from $1.1 billion to $1.7-$2 billion, representing a 100% increase due to inflationary pressures and site-specific challenges.
Delayed Project Timelines
Project Permian's timeline has been pushed to groundbreaking in 2027 with an in-service date in 2029 due to cost optimization and capital raising challenges.
Challenges in Securing Capital
Net Power faces a funding gap of $600-$900 million for Project Permian and is exploring strategic partnerships and capital solutions to fill this gap.
Company Guidance
During the fourth quarter 2024 earnings call, Net Power Inc. provided guidance highlighting several key metrics and strategic initiatives. The company reported over $530 million in liquidity at year-end, positioning it strongly to advance its technology and optimize plant designs. They completed the front-end engineering and design (FEED) for Project Permian, also known as SN1, with an estimated total installed cost now ranging from $1.7 billion to $2 billion, reflecting a 100% increase due to inflationary pressures and site-specific challenges. CEO Danny Rice emphasized a strategic pivot towards cost reduction, focusing on post-FEED optimization and value engineering to lower costs without compromising performance. For 2025, priorities include further cost reduction for Project Permian, feasibility studies for multi-unit projects along the Gulf Coast, and capital raising efforts. The La Porte demonstration facility achieved significant milestones, including over 140 fired hours during Phase 1 of the equipment validation program with Baker Hughes. Overall, Net Power is committed to delivering the lowest-cost form of clean, firm power, leveraging its strategic partnerships and robust liquidity position.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.