Why Oppenheimer Loves This Little-Known Wireless Electricity Company
Oppenheimer initiated coverage on Energous Corp (NASDAQ: WATT) Thursday with an Outperform rating and $13 price target.
Analysts Andrew Uerkwitz and Martin Yang believed the company could "disrupt the wireless charging space with its RFbased, uncoupled, WattUp technology which has the ability to charge/power devices within a 15 foot radius."
The analysts felt that the potential market size was so large, with the long distance capability so impressive, that it outweighed the "the risks associated with start-ups and the need for FCC approval."
"Energous' WattUp technology transmits energy over the 5.7-5.8GHz (same as Wi-Fi) unlicensed ISM spectrum in the form of RF (radio frequency) signals. Energous ultimately seeks to embed its transmitters in a variety of home appliances such as TVs or refrigerators but it is likely that the first consumer released transmitters will be in the form of Energous specific base stations or Wi-Fi routers," the note said.
"Transmitters locate receivers using BLE (Bluetooth Low Energy) then generate a waveform, an RF pocket around the targeted receiver. Receivers, which use Bluetooth for authentication, then harvest the RF signal which is ultimately converted to a DC signal used to power/charge the device," it added.
Uerkwitz indicated that the company had a first mover advantage and that while competitors had been developing similar RF-based wireless charging solutions, the analysts believed "Energous is a step ahead" and did "not foresee any consumer ready products from uncoupled competition in the near term."
The company had not yet posted any revenue, however, it was expected that some licensing revenue would be booked this year.
As for risks that could affect adoption, Uerkwitz highlighted three: "1) execution risk associated with a JDA strategy; 2) competitive pressure from well-established close-coupled charging companies; and 3) developments in the battery industry with regards to longer life and faster charging time."
Energous recently traded at $9.99, up 8.11 percent.
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