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Environmental Tech Co. Poised for Continued Growth
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The firm is expected to return to profitability this year, noted a Zacks Small-Cap Research report.

ME2C Environmental (MEEC:OTCQB), aka Midwest Energy Emissions Corp., should achieve strong double-digit topline growth in this year," reported Zacks Small-Cap Research analyst Steven Ralston in a May 22 research note.

"We expect revenues to increase by at least 35% in 2023," Ralston wrote. "Management expects annual revenue growth of approximately 50% in 2023."

Compelling Investment Opportunity

This U.S.-headquartered company offers investors a significant potential return of about 175% currently. This is shown via the gap between Zacks' price target on ME2C of CA$1.10 per share and its current price of CA$0.40 per share.

Three Pillar Approach

Ralston highlighted that ME2C is pursuing three general strategies to keep growing revenue. Given its success in 2022, it is well poised to continue its upward trajectory in this regard.

1) Focusing on core technologies: Revenue from licenses and recurring sorbent sales related to its patented mercury capture process have been driving ME2C's recent growth. The firm aims to continue expanding this business line by continuing to enforce its successful patent litigation effort against coal-fired EGUs.

ME2C is looking around the globe for new customers. Recently, it engaged a Hong Kong consulting company to garner licensing agreements for ME2C's SEA (Sorbent Enhancement Additive) technology for reducing mercury emissions and sorbent product supply contracts in Southeast Asia.

Just last month, ME2C landed a new three-year supply contract, valued at about US$9 million ($9M), with an existing licensee.

Also, to meet an anticipated rise in demand for electricity from domestic coal-fired electric generating units, the company proactively built a new manufacturing and distribution facility in Texarkana. Its capacity can support US$100M in annual product supply revenues.

2) Enforcing patent protection: ME2C's second tack is to keep protecting its patented technology by seeking compensation from refined coal operators that have allegedly unlawfully utilized its SEA technology.

Additionally, an estimated 29 power plants with multiple refined coal-fired electric generating units are still using ME2C's patented technologies without a license. It is expected that resolution of the current litigation will push these entities to seek either a license or supply agreement with ME2C.

3) Expanding its product line: ME2C is working to develop additional technologies, such as one to extract rare earth elements, on which it is making progress, and another to remediate wastewater from coal-fired power plants.

As for its rare earth element extraction efforts, Ralston relayed that ME2C "management hopes to conduct a commercially viable field test once the laboratory work is successfully completed."

Recent News

Also, in his research note, Ralston reported some of ME2C's latest developments.

In April 2023, the company received conditional approval to list its common shares on the TSX Venture Exchange. Management expects its ticker symbol to be MEEC.

Last month, ME2C reported full-year 2022 (FY22) financial results, noting year-over-year increases in revenue and sorbent sales. Total revenue in FY22 was US$21.62M, up 66.2% from US$13.01M in 2021. Sorbent product sales rose 87.6% between 2021E and 2022E to about US$20.64M from US$11M.

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Important Disclosures:

  1. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Midwest Energy Emissions Corp., a company mentioned in this article.
  2. Doresa Banning wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor.
  3. The following companies mentioned in this article are billboard sponsors of Streetwise Reports: ME2C Environmental. Click here for important disclosures about sponsor fees. 
  4. The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
  5. From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the decision to publish an article until three business days after the publication of the article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases.

Disclosures for Zacks Small-Cap Research, Midwest Energy Emissions, May 22, 2023

ANALYST DISCLOSURES I, Steven Ralston, hereby certify that the view expressed in this research report accurately reflect my personal views about the subject securities and issuers. I also certify that no part of my compensation was, is, or will be, directly or indirectly, related to the recommendations or views expressed in this research report. I believe the information used for the creation of this report has been obtained from sources I considered to be reliable, but I can neither guarantee nor represent the completeness or accuracy of the information herewith. Such information and the opinions expressed are subject to change without notice.

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POLICY DISCLOSURES This report provides an objective valuation of the issuer today and expected valuations of the issuer at various future dates based on applying standard investment valuation methodologies to the revenue and EPS forecasts made by the SCR Analyst of the issuer’s business. SCR Analysts are restricted from holding or trading securities in the issuers that they cover. ZIR and Zacks SCR do not make a market in any security followed by SCR nor do they act as dealers in these securities. Each Zacks SCR Analyst has full discretion over the valuation of the issuer included in this report based on his or her own due diligence. SCR Analysts are paid based on the number of companies they cover.

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CANADIAN COVERAGE This research report is a product of Zacks SCR and prepared by a research analyst who is employed by or is a consultant to Zacks SCR. The research analyst preparing the research report is resident outside of Canada, and is not an associated person of any Canadian registered adviser and/or dealer. Therefore, the analyst is not subject to supervision by a Canadian registered adviser and/or dealer, and is not required to satisfy the regulatory licensing requirements of any Canadian provincial securities regulators, the Investment Industry Regulatory Organization of Canada and is not required to otherwise comply with Canadian rules or regulations.

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