SKYX Platforms Corp.'s (SKYX:NASDAQ) smart products are coming to Home Depot due to a new collaboration between the two companies, reported Patrick McCann, research analyst at Noble Capital Markets, in a July 31 research note.
"The partnership with Home Depot is validation of the SKYX technology by a global industry leader," McCann wrote.
SKYX develops safe and smart technologies for homes and commercial buildings, including a weight-supporting ceiling receptacle, technology-enhanced light fixtures and plug-and-play devices.
367% upside in undervalued stock
Florida-based SKYX is trading at about $1.07 per share, at a discount to peers, noted McCann. Noble's price target on the tech company is $5 per share.
"Our price target reflects a multiple of roughly 3.4 times enterprise value to our 2025 revenue forecast, more in line with peers," the analyst wrote. "In our view, the shares offer a favorable risk-reward relationship."
The return implied in Noble's target is 367%.
SKYX remains rated Outperform.
Significance of collaboration
This is the first time SKYX's products will be available in a big box retailer's stores, McCann pointed out. They'll be sold on Home Depot's website as well.
The analyst wrote he expects the partnership to positively impact sales of SKYX's products for both residential and commercial purposes.
"The recent announcement should contribute to increased revenue momentum in the back half of the year," he added. "We believe it could also lead to additional partnerships with other large home improvement retailers."
Noble maintained its Q2/24 estimates of $22 million ($22M) in revenue and $4M in adjusted EBITDA. SKYX is expected to report is Q2/24 results on or around Aug. 9.
What to watch for
Along with potentially increased sales and Q2/24 results, two additional future events stand out as likely catalysts of SKYX's stock, noted McCann.
One is receiving Mandatory Safety Standardization from the National Electrical Code as this could "enhance its revenue growth trajectory," the analyst wrote. The second is the company becoming cash flow positive.
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