Q: In your response today to Trent, you say that for CEI, growth is expected to explode in the near term. Can you provide more details. Would you consider it a Buy? Thanks
5i Research Answer:
CEI just came public in recent years and on;y started to generate revenue in recent quarters. As a result, revenue is expected to “explode” from practically a base of zero. Based on the consensus estimate, CEI’s revenue growth is expected to be triple-digit in FY2024. However, there is limited visibility into the future of this tiny company. For names like CEI, growth could be really strong in some years and negative in others. As a result, there are really high-risk, speculative names; we think investors are better off looking for opportunities in companies with larger market caps.