Cadiz signs MOU with Hoku Energy for clean energy development

LOS ANGELES - Cadiz Inc. (NASDAQ:CDZI), a $246 million market cap company whose stock has gained over 7% in the past week, has entered into a memorandum of understanding with UK-based Hoku Energy Limited to develop a clean energy campus on its property in California’s Mojave Desert, according to a press release statement issued Friday.According to InvestingPro data, Cadiz shows strong growth potential, with analysts expecting both sales and net income growth this year. Subscribers can access 10 additional exclusive insights about CDZI’s financial health and market position.

The agreement provides Hoku Energy with a three-year exclusive option to develop more than 10,000 acres at Cadiz Ranch. The project could include green hydrogen production, renewable power generation, battery storage facilities, and digital infrastructure such as data centers.

The MOU represents Cadiz’s second land lease agreement for clean energy development within the past year, following a 2024 agreement with RIC Energy to develop up to 3,000 acres for green hydrogen production.

"This agreement with Hoku Energy is the capstone of our long-term land use strategy," said Susan Kennedy, Chair of Cadiz Inc.

The agreement does not restrict Cadiz’s existing agricultural operations or the development of its Mojave Groundwater Bank. It also reserves 400 acres for additional commercial development, potentially including a data center, with Hoku having right of first refusal to supply power to that facility.

Cadiz expects clean energy and digital infrastructure projects to generate $7-$10 million per year in lease revenue and water supply sales, according to the company. This projection comes as the company demonstrated remarkable revenue growth of 284% in the last twelve months. InvestingPro analysis suggests the company is currently trading near its Fair Value.

The Cadiz property features infrastructure including rail access, water resources, and pipeline corridors that make it suitable for large-scale energy and data center development. The company filed additional details about the MOU in a Current Report on Form 8K with the SEC.

In other recent news, Cadiz Inc. announced key developments impacting its business and strategic direction. The company held its 2025 Annual Meeting of Stockholders, where shareholders approved several proposals, including the election of directors and an amendment to the equity incentive plan. PricewaterhouseCoopers LLP was ratified as the independent auditor for the fiscal year 2025, and an advisory vote passed on executive compensation. Cadiz Inc. also reported significant progress in its water supply and storage project, securing a lead project investor and acquiring 180 miles of steel pipe from the Keystone XL project to mitigate potential cost risks. The company received an investment tax credit that will cover up to 50% of the projected $120 million for generation equipment, supporting investor attraction and cost management. In a move to enhance its financial strategy, Cadiz Inc. declared a cash dividend for its Series A Cumulative Perpetual Preferred Stock, with dividends distributed to shareholders of record. Roth/MKM initiated coverage on Cadiz with a Buy rating and a $10 price target, highlighting the strategic positioning of its Mojave Ground Water Bank & Supply system. These recent developments underscore Cadiz Inc.’s active engagement in advancing its projects and financial strategies amidst evolving market and regulatory conditions.

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