Volatus Aerospace Corp. (VOL:TSX; VLTTF:OTCQB) has released a press release regarding its contract to begin operations in oil and gas pipeline surveillance in the U.S., an industry which it has long been involved with in Canada.
Glen Lynch, the CEO of Volatus, commented, "Our experience and expertise put us in a strong position to capture a market opportunity that is expected to grow to US$1.1 billion by 2033."
Volatus reports that it believes it has the upper hand in this market due to its unique Aerial Information Reporting System and its incorporation of other cutting-edge technology, such as artificial intelligence (AI).
According to Volatus, this marks a major achievement for the company, especially since the U.S. has many more oil and gas pipelines than Canada. The company reports that its drones will be used to detect defects in the pipeline infrastructure, such as leaks and imminent threats.
Rob Goff of Echelon Capital Markets reported in August that he expects Volatus to improve in Q2 of 2023 by considerable margins. Goff named a target price of CA$0.90 for Volatus, which represents a 283% return for investors, and rated the company as a "Speculative Buy."
The company has reported that to further its efforts in pipeline surveillance, Volatus has entered into a contract with Flyscan Systems Inc. to install new technology on its drones. According to the latest press release,
Flyscan provides a "state of the art hyperspectral sensor pod, and software enable automated airborne gas leak [detector]," allowing Volatus' drones to detect evidence of pipeline breaches with greater accuracy than a human observer.
Ben Ruszkowski, the chief operating officer of Synergy Aviation, a subsidiary of Volatus, commented, "With this partnership, Volatus will be advancing toward the next generation of autonomous pipeline surveillance, making the unseen seen. The challenges we face today, such as safety and environmental concerns, can be solved with the introduction of automated remote sensing, machine learning/AI-enhanced capabilities, which we are uniquely qualified to offer with our partner Flyscan."
A Growing Market
According to Grand View Research, drones are a growing market, valued at US$19.89 billion last year. Grand View Research identified drone's increasing capability and practicality, as well as technological advances, as drivers of growth in the drone market.
Fortune Business Insights also expects the drone market to increase significantly by 2030, where it predicts the market will reach US$54.81 billion.
Fortune Business Insights notes that the market was also driven forward by the pandemic when contactless technology became a large priority for many businesses.
A 283% Return for Investors
Rob Goff of Echelon Capital Markets, who provides analysis of Volatus, reported in August that he expects Volatus to improve in Q2 of 2023 by considerable margins. Goff named a target price of CA$0.90 for Volatus, which represents a 283% return for investors, and rated the company as a "Speculative Buy."
Goff commented on the expected gains, saying, "We note the company's prior reference to a robust sales pipeline where we are optimistic that it will secure significant wins."
Volatus has reported several significant catalysts for the company, including finalizing the acquisition of U.S. utility company Skyscape, its advance into wildfire control in Alberta, Canada, and various approvals in the country related to wildfire suppression efforts and the SEAR program's break into the U.S. market.
Ownership and Share Structure
Streetwise Ownership Overview*
Reuters provided a breakdown of Volatus' share structure, where management and insiders own 63.1% of the company. According to Reuters, Ian Alexander McDougall owns 31.75% with 39.02 million shares, CEO Glen Lynch owns 31.29% with 38.46 million shares, and Vice President Luc Masse owns 0.06% with 0.08 million shares.
According to Reuters, the institution Palos Management Inc. owns 0.49% with 0.60 million shares.
The company reports no strategic investors.
Volatus reports that it has CA$6.8 million in the bank as of September 30, 2022, with a monthly burn rate of CA$500k.
According to the company, there are two sets of warrants valued at CA$0.65 and CA$0.75 set to expire on December 22, 2023, and a third set valued at CA$0.50 set to expire on October 5, 2024.
Reuters reports that there are 122.91 million shares outstanding, with 45.35 million free-float traded shares.
According to Reuters, the company has a market cap of CA$18.59 million and trades in the 52-week period between CA$0.20 and CA$0.44.
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- As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Volatus Aerospace Corp.
- Amanda Duvall wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
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