Broadwind Energy, Inc. BWEN recently announced that it has secured a tower-supply contract from a U.S.-based wind turbine manufacturer. The contract, expected to solidify the company’s position in the wind turbine market, has lifted investors’ sentiments. Primarily driven by the news, the company’s share price has gained roughly 4.3% on Jun 25.
As revealed, Broadwind Energy will manufacture the towers at its facilities located in Manitowoc, WI and Abilene, TX. Valued at approximately $50 million, the contract will likely be delivered in 2016.
In April, Broadwind Energy secured a similar tower-supply contract, worth $13 million, from a U.S.-based wind turbine manufacturer. The order will be executed at the company’s Manitowoc, WI-based facility.
We believe such back-to-back contract wins reflect the growing preference of customers for Broadwind Energy’s products and services. Also, the extension of production tax credit in late 2014 has been positively impacting tower orders for the company, which, in turn, aids its profitability.
In first-quarter 2015, Broadwind Energy received new orders worth $23.3 million, up from $15.8 million in the year-ago quarter. Of the total orders, Towers and Weldments orders comprised $11.8 million, while Gearing orders approximated $9.7 million. Services orders totaled $1.9 million. Backlog stood at $174 million at the end of first quarter.
Broadwind Energy presently has a market capitalization of $60.7 million. The company encounters competition from other players in the machinery industries, including EnPro Industries, Inc. NPO, IDEX Corporation IEX and Luxfer Holdings PLC LXFR. All these stocks carry a Zacks Rank #2 (Buy).
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