Nano Nuclear Energy Inc. (NNE:NASDAQ) raised $18 million in an upsized equity offering, with which the company may accelerate its strategic initiatives, reported The Benchmark Co. analyst Michael Legg in a July 15 research note.
"We believe the additional cash on the balance sheet will enable Nano Nuclear to accelerate growth initiatives, including Nuclear Regulatory Commission (NRC) applications, consulting services and related mergers and acquisitions, physical demo reactor development and establishment of a company campus for research and development and related projects," Legg wrote.
The company is developing portable clean energy solutions, including nuclear microreactors, and the related supply chain.
56% gain possible
Given the news, Benchmark reiterated its $39 per share price target on the New York-based company, now about $25 per share, noted Legg. The difference between these prices implies a potential return for investors of 56%.
Nano Nuclear remains a Buy.
"We believe the stock will benefit from increased knowledge and proliferation of demand for small modular reactors as safety and use cases gain public acceptance as climate change
initiatives favor emission free energy and see such as key catalysts for the stock alongside continued operational progress," Legg commented.
Details of cash raise
In this upsized financing, Nano Nuclear any sold 900,000 shares of common stock along with warrants to purchase 450,000 shares of common stock, at a cost of $20 per unit, Legg relayed.
Each unit is comprised of one common stock share plus one warrant to purchase up to one-half of a common stock share.
"Our share count [for NNE] increases to 55 million (55M) shares from 29M today, factoring in equity raises over the next five years," wrote Legg.
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