Arqit raised $400 million in a SPAC merger in August 2021 and was valued at the time at $1.4 billion. Its market value has declined by about a third since then, and the shares have dropped about 63% since the company came public. From the all-time high posted in December of last year, the share price has tumbled nearly 72%.
One of the two brokerages covering the company has a Buy rating and the other has a Hold rating. At a recent price of around $7.65 a share, the upside potential based on a median price target of $15.00 is 96%. At the high price target of $26.00, the upside potential is nearly 280%.
The analysts covering the stock expect Arqit to post revenue of $30.1 million and a loss per share of $0.06 for the 2022 fiscal year that ended in September. In May, the company reported $12.3 million in revenue for the first six months of its 2022 fiscal year. The operating loss for the period was $14.3 million compared with a prior-year loss of $5.5 million for the same period. Adjusted profit totaled $58 million, but a noncash change in the fair value of warrants totaled $72.5 million. Excluding the charge, Arqit posted $0.48 of diluted earnings per share (EPS) for the six-month period.
For the full fiscal year, the two analysts expect the company to post EPS of $0.23 on sales of $113.4 million, a jump of more than 275% in revenue. In 2024, the same analysts expect sales to rise by nearly 130% to $259.32 million with EPS of $0.81.
The stock’s 52-week trading range is $3.80 to $26.90, and Arqit does not pay a dividend. Total shareholder return for the past 12 months is negative 63.1%.
Scorpio Tankers
Scorpio Tankers Inc. (NYSE: STNG) operates a fleet of 113 refined product tankers of various capacities with an average age of 6.2 years. As has been the case with other crude and refined product tankers, Over the past year, tanker companies have all seen share price increases, but Scorpio’s 300% jump is more than double that of its nearest rival. The Monaco-based shipper will release a market update for the current (fourth) fiscal quarter Wednesday morning.
Last month, Scorpio CEO Robert Bugbee told a conference in New York:
The party hasn’t even started yet. The host may be drinking a couple of drinks but nobody has come yet. They are at the pub, waiting to go to the party later. The stress hasn’t even begun to be put on the product-tanker market.
What we are worried about and I’m sure some of the other people here are worried about is that this gets too good. This could get crazy. We cannot do the mathematics now to get required [future] demand for products to match the ships able to transport it.
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