ASTI been straight up since this post on it two months ago. Despite the impressive run-up, I remain long. Few developments:
\- They successfully raised 10m, a large amount given the size of the company. Going into the trade two months ago, that was the primary risk - that an offering would crush momentum. I think in the short-term with that behind it some of the downside risks are diminished [https://www.reddit.com/r/TheRaceTo10Million/comments/1po5i0y/spacex\_and\_the\_emerging\_solar\_space\_theme/](https://www.reddit.com/r/TheRaceTo10Million/comments/1po5i0y/spacex_and_the_emerging_solar_space_theme/)
\- Thanks to Elon's FCC request to put 1m ai sats in orbit and his relentless campaigning about this concept space solar continues to be front of mind as an emerging theme. As people continue to look for ways to actually get exposure to the concept, ASTI continues to dominate as basically the only pure play. As a result the amount of DD being put out on this company is astounding. I consider that a good indicator of a trade that has depth and legs to it
**Bottom line, I remain as bullish as every. Now onto RELL.**
RELL makes a number of components that are surprisingly crucial to a number of industries. For example, their ultracapacitors are found in \~40,000 wind turbines, and they are the primary supplier of magnetrons used in synthetic diamond machinery. The problem has been that their legacy products are vacuum tubes, which accounts for the majority of their revenue. What's changed is their Energy Storage Solutions segment has seen 39% yoy growth, and they are seeking to move from largely producing ESS components to ESS solutions.
https://preview.redd.it/3mlyd6cr7wig1.png?width=697&format=png&auto=webp&s=f2a7560cd8d23d38c5909f16f4626e7a3a63b578
They are well on their way to being a ESS solution provider. AI energy hype has increasingly shifted form energy sources to batteries as the most practical way to increase power available to AI centers. Hence, nearly all ESS companies are trading at mania multiples and continue to go parabolic. RELL recently complete an expansion in Illinois and a new design center in Texas to accelerate the manufacturing of made-in-USA battery ESSs. This seems like a slam dunk. They have the history of creating industry critical electrical components for many years. They have the capacity to build these ESS systems. And the demand is there. I really see no reason why this would not come to fruition and represent a radical transformation of the company.
https://preview.redd.it/qgqokp6u7wig1.png?width=1080&format=png&auto=webp&s=1215e84a81527a7779b6b5bc6a67d8899faa4a3a
Now the company has a lot of depth, and it is shaping up to a situation like ASTI - where one moment there was literally zero DD, and as people read into it they continue to find tremendous depth to the company.
**Where I think it gets interesting in the insane level of torque available on this. It needs to re-rate very little compared to its peers in order for this to be an incredibly good options trade.**
**Right now it trades at \~.7x sales. It could re-rate to around 2x-3x sales (which would still be the lowest of ESS companies by a long shot) and there are strikes that would offer 10-20x returns.**
A trade where you can get that kind of returns for a such a modest reconsideration of a small cap - you can't find that at this stage of the market.
I have more to say about the company, but I don't think anyone is looking to read a book at this point. If it gains interest, I'll be writing more.