12/27/2023 0 Comments Don carbon originSnapshot of Origin Materials (Origin Materials IR) Customer demand remains robust Most importantly in the current investment climate that we are in right now, Origin expects that it will be fully financed until it turns EBITDA positive as a result of anticipated financing, grants and even potential strategic partnerships it might obtain. The company has $9.3 billion in customer demand in the form of off-take agreements and capacity reservations with large, global companies. It has a large total addressable market of more than $1 trillion given the wide range of products that its platform can cater to. Its patented technology platform is able to use the carbon found in sustainable wood residues into useful materials and capture the carbon in the process of doing so. Introduction to Origin MaterialsĪs a brief introduction to Origin Materials, it is a leading carbon negative materials company in the world. The company also remains well funded for the construction of Origin 1 and 2 and expects to have sufficient funding until it achieves positive EBITDA, implying the business is poised for sustainable growth. Today, Origin Materials appears to be executing well in its strategy towards being a leading carbon negative materials company. I will be watching the ramp up of production in Origin 1 closely as this will indicate to me how management will be able to scale up production in subsequent plants and the execution in the construction of Origin 2 is also key given that it will be its first large scale manufacturing facility with huge economies of scale to be reaped. With Origin 1 expected to start up by the second quarter of 2023, potential and existing customers of Origin Materials can then obtain large volumes of samples for testing and developing new products. The company continues to see strong customer demand from large and global companies while executing well in its construction of Origin 1 and 2. Origin Materials looks to me to be emerging as a leading carbon negative materials company in the world. I have also written other articles on Origin Materials, which can be found here. Today, in this article, I aim to highlight some of the key investment thesis for Origin Materials and why it is such a compelling investment today. In an earlier article to members of Outperforming the Market, I elaborated on why I am adding Origin Materials to The Barbell Portfolio. It focuses on the global carbon emissions that come from the production of materials, which according to the Ellen MacArthur Foundation, makes up 45% of global carbon emissions. Origin Materials plays an important role in this transition as its mission is literally to "enable the world’s transition to sustainable materials as the leading carbon negative materials company". In 2022 alone, $1.1 trillion was spent on investments into the energy transition. We are sitting at the cusp of a long-term period of green transition where governments and companies globally will spend trillions into green investments. I think that it is inevitable that one of the best alpha generating opportunities of our generation is that of the green transition. Today, the company I'll be writing about in this article is Origin Materials ( NASDAQ: ORGN). This article was first posted in Outperforming the Market on 27 February 2023. Claudio Rampinini/iStock via Getty Images
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