In an April 27 research note, Haywood Securities analyst Colin Healey reported that Exro Technologies Inc. (EXRO:TSX.V), a Haywood 2021 Top Pick, signed an agreement with Vicinity Motor Corp. to test, validate and, potentially, use Exro's coil driver technology in Vicinity's electric buses.
"We consider this a key partnership with a higher profile bus maker and expect Exro's stock to respond well to the news," Healey wrote.
Exro is trading now at about CA$4 per share, down from its high range of CA$5.50–6.50 in February 2021. As such, Haywood recommends investors take advantage of the fact Exro is trading at a discount and add to their position. The investment firm's target price on Exro is CA$8 per share.
Healey relayed that Vicinity manufactures shuttle transportation vehicles for commercial and public use in Canada and the U.S. Its flagship vehicle is the Vicinity EV bus.
According to the agreement, explained Healey, Exro will provide Vicinity with a coil driver system and Vicinity will incorporate it into the powertrain of one of its buses. The vehicle company then will test and validate the technology with an eye toward deploying it in future Vicinity EV bus production.
According to Vicinity, Healey noted, Exro's coil driver technology offers what existing systems cannot, improved performance and efficiency, resulting in extended bus range.
"Today's news is important as it further accelerates Exro's path to commercialization of its coil driver technology," Healey wrote. He added that he expects the agreement will lead to commercial sales and greater exposure of the technology to prospective customers.
Haywood has a Buy rating on Exro.
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