Buy AquaVenture as water scarcity issues swell
Strategic Trade / Buy
Head of Equity Strategy
Price Target: 26.00
Market Price: 13.24
Water supply is highly regulated as it's perceived as a public good often with a fixed price. In theory it should show very little correlation to economic or market fluctuations, but all of the ETFs tracking water infrastructure have high correlations to the general equity market making water investments mostly an overall equity market play.
Entry: limit buy in the 12-14.50 range.
Stop: the stop is set at 10.50 which would reflect a breakout to the downside and thus a potential new scenario.
Target: the target is set to 26.00 which would the all-time-high from December 2016. For really long-term investors in AquaVenture, an open-ended target may be more prudent.
Time Horizon: the time horizon is expected to be long (over a year) unless equity markets decline taking risky small caps like AquaVenture down with them.
Quarterly Outlook Q2 2022
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