Ocean Power Technologies Inc (NASDAQ: OPTT) is having an overwhelmingly strong start to the trading session this morning, and for good reason. The company announced that it has entered into a multi-year power supply agreement. Of course, investors heard the news and excitement built, leading to strong gains in the value of the stock. Today, we’ll talk about the news, what we’re seeing from the stock, and what we’ll be watching for with regard to OPTT ahead.
OPTT Gains On Power Supply Agreement
As mentioned above, Ocean Power Technologies is having an incredibly strong start to the trading session this morning after announcing that it has signed an agreement. In a press release issued early this morning, the company announced that it signed an agreement with Eni S.p.A. Under the terms of the agreement, OPTT will supply a PB3 PowerBuoyTM for a demonstration of Eni’s subsea oil and gas operations.
In the release, OPTT said that the agreement will provide for a minimum of a 24 month contract that includes an 18 month PB3 PowerBuoy lease and associated project management. In a statement, George H. Kirby, President and CEO at OPTT, had the following to offer:
This commercial agreement with Eni is our first in the oil and gas market and is a significant milestone for our Company. The technology being developed could allow Eni to use clean energy to demonstrate the power and communications capabilities of a combined PB3-subsea battery charging system in a harsh offshore environment, for AUV and other applications. We are excited about this new relationship and look forward to helping Eni further advance its operations.
We believe the Eni deployment could lead to other applications including the charging of underwater unmanned vehicles, well monitoring and decommissioning applications in the oil and gas industry, as well as metocean data collection. We hope to leverage this work to further expand the use of our PB3 PowerBuoy™ throughout our target markets including oil and gas, security, defense and telecommunications.
What We’re Seeing From The Stock
One of the first things that we learn when we start to work in the market is that the news causes moves. In this particular case, the news proved to be overwhelmingly positive. After all, the new contract will drive significant revenue for Ocean Power Technologies. So, it’s no surprise to see that the stock is headed for the top. At the moment (10:06), OPTT is trading at $1.28 per share after a gain of $0.07 per share or 5.79% thus far today
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on OPTT. In particular, we’re interested in following the story surrounding the contract announced today as well as the continued expansion of the company’s PB3 PowerBuoy product. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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