Investors with a high tolerance for risk might want to check out the ASX tech stock in this article.
That's because if analysts at Bell Potter are on the money with their recommendation, it could double your money for you over the next 12 months.
Which ASX tech stock?
The tech stock in question is environmental technology company Calix Ltd (ASX: CXL).
It is focused on solving global challenges in industrial decarbonisation and sustainability. This includes CO2 mitigation, sustainable minerals processing, advanced batteries, biotechnology, and water treatment.
Bell Potter highlights that Calix is commercialising and developing a range of environmentally friendly solutions for industry. These solutions are derived from its patented minerals processing technology, the Calix Flash Calciner (CFC). It notes that the CFC is a patented reinvention of the calcination process that produces very high surface area nano-active materials, without the safety concerns or high production costs of nanoparticles.
In addition, Bell Potter points out that the technology can be used to separate and capture the CO2 by-product when decomposing carbonates into oxides, such as during the manufacture of cement and lime.
The broker notes that this CFC technology can be adapted for a broad range of applications based on a variety of minerals. However, the company has prioritised solutions for five target areas with a combined addressable market of $70 billion.
Big returns but high risk
Bell Potter is cautiously positive on the company's long-term outlook and has reaffirmed its speculative buy rating with a $2.40 price target. Based on its current share price of $1.17, this implies potential upside of 105% for this ASX tech stock over the next 12 months.
To put that into context, a $10,000 investment in this stock today would turn into $20,500 if the broker is proven correct with its recommendation and valuation.
Though, it is worth highlighting that you could just as easily lose half your money (or more) from a speculative investment like this. So, this is really one for only those with a very high tolerance for risk.
Bell Potter concludes:
CXL's growing suite of CFC applications target global challenges, including decarbonisation of hard-to-abate industrial processes (lime, cement and steel making), and improvement to supply chain efficiency (lithium concentrate value adding). CXL represents a valuable sustainable investing opportunity for ESG-focussed investors. CXL is a development company with prospective operations and cash flows only. Our Speculative risk rating recognises this higher level of risk and volatility of returns.
