Phinergy Ltd. develops clean and high energy-density systems based on metal-air technology. The company offers aluminum-air and zinc-air technology, which provide clean energy generation and storage solutions for various applications in energy backup, electric mobility, and renewable energy storage. It offers energy backup, electric transportation, and energy storage solutions. The company was founded in 2008 and is based in Lod, Israel.

Israel

Phinergy Ltd.

Industrials

The company does not pay dividends at all, or it pays them sporadically. There have only been a few years with dividend payments in the past ten years. 

PNRG.TA reported revenue of ILS 5mn in the last 12 months, down 98% from FY23. The dynamics of cash flow, as measure by free cash flow (FCF), were rather similar. EPS fell 98% from FY23 to ILS -0.70.

Over the last six months, the stock performance has varied, with an increase following a drop. When measured against its worldwide peers from the same industry (as shown above), the stock has been weaker, underperforming by 47ppts. This is equally valid for peers from the same country and industry. Given the stock's valuation versus its peers, its total price movement is neither favourable nor unfavourable.

The company has reported very poor EBITDA margins compared to its global peers in recent years. EBITDA margin amounted to 616.6% in the last 12 months, up from -1015.5% in FY23. 

Historically, PNRG.TA has reported very poor net margins compared to its global peers. Specifically, in the last 12 months, this metric equalled -245.4%, a growth from -1236.1% in FY23. 

In the last 12 months, the return on capital employed (RoCE) declined to -417.0%, below the peers. 

Another important profitability metric, return on assets (RoA), amounted to -375.2% in the last 12 months, a decrease from -41.0% in FY23. 

Phinergy Ltd. reported a return on equity (RoE) of -642.8% in the last 12 months, up from -1191.5% in FY23. 

The ratio of return on invested capital (RoIC) to the weighted average cost of capital (WACC) has been -28.0 in the past several years. This ratio implies a fragile shareholder value creation. 

The institutional, legal, and compliance risks associated with the company's country are minimal. In combination with stringent business standards, shareholder rights are very highly protected.

PNRG.TA has below average trading liquidity. The average private investor can sell his common position in the stock almost immediately. Liquidity may be unstable and remains extremely favourable on the days with the lowest activity. The trading volume mostly stays the same even under highly turbulent market conditions. Another factor to consider is the substantial number of days with zero trading volumes, i.e., without any ability to sell a position. The stock has a very small market capitalisation, which usually makes its trading liquidity erratic and unpredictable. 

No other major risks have been identified.

The risk of default is high. Among the negative credit factors, we point to weak positions in its industry, bleak profitability, negligible return on capital, inadequate interest coverage, and poor cash flow generation. We note resilient historical revenue growth, low margin volatility, strong debt servicing capacity, and an favourable capital structure, among the positive credit factors. 

In highly turbulent market conditions, PNRG.TA is exceptionally volatile. In other words, the stock will be among the worst-performers in times of extreme market volatility or shocking company news. Standalone, the worst-day losses (less than 1% of the time) will likely be critical. 

In normal market circumstances, PNRG.TA is exceptionally volatile. Put differently, without outstanding market volatility or shocking company news, the stock's price will change quite unpredictably. The stock's losses on its worst days (less than 1-5% of the time) will range from critical to immense. 

From both historical and forecast perspectives, the stock is considerably underpriced compared to similar stocks. Specifically, the stock is undervalued on EV/EBITDA. 

Phinergy Ltd.

ILA 125.6

3

Phinergy Ltd.

ILA 125.6

3

Risk factor

Profitability factor

Risk / Profitability

Risk factor

Profitability factor

ILA 125.6

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