International Wastewater Systems (IWS:CN) is a company focused on using sewage as a source of renewable energy.
Through the use of innovative products (Sharc and Piranha), IWS:CN connects to the sewer system of a building and capture the heat from the wastewater. It then harnesses the recycled energy for domestic water and/or space heating, as well as, powering air conditioning systems.
The company operates within two segments; multi-residential and industrial buildings. Most of the multi-residential installations are located in Vancouver, Canada. However, the industrial installations are present in many countries: Canada, Australia, USA, and Scotland, IWS:CN has a great business model; a zero installation cost in exchange for a recurring revenue streams (paid over multiple years) for the install and energy savings.
In the past year, the company has made some notable alliances: RENEW Energy Partners LLC, Scottish Water Horizons, Beijing Ruibaoli Thermal Technology, and Prospect Silicon Valley among others.
The joint venture with RENEW Energy generated a $60M order for the next five years and led to a 52 week high. The alliance with Scottish Water Horizons is also significant as it provides an addressable market of 5 million residential and 150,000 business customers in Scotland. Similarly. the MOU with Beijing Ruibaoli Thermal Technology (BRTT) represents a non-exclusive license to market and sell IWS:CN's proprietary equipment in China. Interestingly, a BRTT executive now sits on the company's board.
The company is headed by Lynn Mueller who was recently interviewed on Bloomberg. In March, Mueller announced that he was selling some of his shares (3M) to participate in a private placement at 0.30 cents with warrants at 0.40 cents. The stock has been in decline of late and is very close to being oversold. Given the trading history, we consider the risk-reward ratio of this price point interesting.
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