Comstock Expands Solar Recycling Footprint in California, Execution Risks Loom

What happened

Comstock Inc. has launched a new storage and prepping facility in California for end-of-life solar panels, targeting the state's large market to support its recycling operations. This satellite hub is designed to collect and prepare panels for closed-loop processing at its Nevada facility, aligning with the company's strategy to scale its PV recycling business. However, the DeepValue report highlights that Comstock's core challenges—such as securing permits, procuring equipment, and finalizing customer contracts for its first industry-scale facility—remain unresolved. With minimal current revenues and significant losses, the company's expansion depends on timely financing and successful asset monetizations to fund its ambitious 2025 targets. While this move demonstrates operational progress, it does not address the key execution risks that could derail the investment thesis.

Implication

Investors should view the California facility as a minor operational advance that enhances collection capacity but does not de-risk the critical path to scaling. Comstock's 2025 revenue target of over $3.5M remains ambitious given its recent $0.34M quarterly revenue and net losses, underscoring the need for rapid progress on permits and contracts. The company's cash position of $18.6M is modest relative to its $12M capex plan and $250M fuels project, heightening dilution risk if planned asset monetizations falter. Without binding MSAs or equipment orders for the main recycling facility, this expansion could strain resources without delivering near-term financial impact. Therefore, the news reinforces the importance of monitoring upcoming milestones like funding closures and customer agreements before considering a more bullish stance.

Thesis delta

The launch of the California facility provides incremental evidence of Comstock's execution on network expansion but does not shift the core investment thesis. Key de-risking events—such as permit approvals for the industry-scale metals facility and securing multi-year customer MSAs—remain unaddressed, leaving execution and financing risks elevated. Consequently, the stance stays HOLD/NEUTRAL, with no material change in the risk-reward profile until more substantive milestones are achieved.