Why Are Xebec (TSX:XBC) Stocks Trending?

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Summary

• Renewable energy solutions provider Xebec Adsorption Inc (TSX:XBC) has been creating a buzz on the stock markets since it announced its latest financials on Thursday, March 25.
• The company reported a 15 per cent year-over-year (YoY) increase in its annual revenue of C$ 56.5 million in 2020.
• On a quarterly basis, however, its revenue shrank by 53 per cent YoY to C$ 6.4 million in Q4 2020 ending 31 December 2020.

Renewable energy solutions provider Xebec Adsorption Inc (TSX:XBC) has been creating a buzz on the stock markets since it announced its latest financials on Thursday, March 25.

The company reported a 15 per cent year-over-year (YoY) increase in its annual revenue of C$ 56.5 million in 2020. On a quarterly basis, however, its revenue shrank by 53 per cent YoY to C$ 6.4 million in Q4 2020 ending 31 December 2020.

Xebec incurred an annual net loss of C$ 32 million last year, as compared to a net income of C$ 2 million in 2019. Its Q4 2020 net loss of C$ 28.3 million was also notably up from that of C$ 0.5 million in Q4 2019.

The Canadian green energy company reported in its latest financials that it had about C$ 168.6 million in cash as of 31 December 2020.

Let’s take a look at Xebec Absorption’s recent stock performance.

Xebec Adsorption Inc (TSX:XBC)

Stocks of Xebec Adsorption slid by more than five per cent on Thursday, March 25, after the company released its financial results.

©Kalkine Group 2021

While Xebec stock is down by about 51 per cent year-to-date (YTD), it has recorded a growth of nearly 79 per cent in the last one year.

The green energy stock is also currently ranked high on the Toronto Stock Exchange (TSX) for its heavy trading activities, with an average share movement volume of over four million for the last 10 days and of about 2.25 million for the past month.

Xebec Absorption holds a market cap of nearly C$ 668 million at the moment, with a price-to-book (P/B) ratio of 7.684 and a debt-to-equity (D/E) ratio of 0.16, as per the TMX data.

1-year chart of Xebec Absorption’s stock performance (Source: EODHD/Others/Thomson Reuters) 

Xebec Absorption is currently facing a lawsuit in the Québec Superior Court on the charges of misrepresenting its 2020 third quarter disclosure documents and the prospectus in regard to its revenue accounting practices, among other things.

The company responded to the claims earlier this month, saying that it has followed the relevant securities laws and that the complaint stands “without merit”.