Transitioning From Old To New: How Dragonfly Energy's Next-Gen Battery Production Could Benefit From Government Subsidies

Chardan Research analyst Brian Dobson reiterated a Buy rating on the shares of Dragonfly Energy Holdings Corp DFLI with a price target of $10.

Dragonfly Energy successfully completed the pilot phase of a domestic production line for lithium-ion batteries.

The production line is capable of producing 150 MWh of LiFePO4 (lithium iron phosphate) battery cells per annum at 70 percent efficiency.

The recently completed pilot line can be utilized for lithium-ion production in the near-term and has the capability to construct solidstate batteries in the future, said the analyst.

This flexibility is a positive for DFLI as it moves toward next-gen battery production.

Also, the analyst said U.S.-based battery builders are eligible for government grants and subsidies.

The two key benefits the analyst sees for Dragonfly are onshoring production opens a variety of opportunities and the process can be used for solid state electrolyte battery production in the future.

The analyst believes the company's deep cycle lithium-ion battery technology is set to disrupt legacy RV, maritime, and "off-the-grid" markets, which are dominated by older, lead-acid technology.

Price Action: DFLI shares are trading lower by 2.94% at $2.00 on the last check Thursday.