10 Green Energy Gambles for 2009: Q2 Performance Update

I never thought 2009 would be a good year for risky stocks, but my readers asked for them anyway. So far, my risk taking readers have not been burnt too badly, and the portfolio as a whole continues to track its benchmarks.

In my first quarter update for my green energy gambles for 2009, I noted that the portfolio had lost about 10%, between the benchmark returns (-12% and -5%), but not very impressive. Since then, the portfolio as a whole has gained a little ground, and is almost exactly midway between the benchmarks.

The following table shows stock-by-stock performance.

Ticker	Price (1/9/09 close)	Price (7/13/09 close)	Percent gain
BCON	$0.46	$0.637	38.5%
AXPW.OB	$1.20	$1.34	11.7%
VLNC	$1.77	$1.51	-14.7%
CPTC.OB	$0.30	$0.245	-18.3%
EPG	$0.86	$0.54	-37.2%
EMKR	$1.43	$1.07	-25.2%
UQM	$1.72	$2.46	43.0%
CZZ	$4.18	$5.00	19.6%
RZ	$3.62	$2.00	-44.8%
ZOLT	$7.47	$8.46	13.3%
Portfolio	$1,000	$986	-1.4%
Benchmarks
ICLN	$22.05	$21.01	-4.7%
PBW	$9.01	$9.15	1.6%

In January, I made two predictions about this portfolio:

1. The portfolio as a whole would fall, unless financial market conditions improve rapidly.
2. All of these stocks have a chance of spectacular returns.

Prediction #1 continues to be on target. As of July 13th, the market as a whole is basically flat for the year, and the portfolio is down a smidgen.

Prediction #2 is harder to judge. The best performing stocks, Beacon Power (BCON) and UQM Technologies (UQM), are up only 38.5% and 43.0%, respectively. While these are not bad returns, after six months, my more conservative 10 Clean Energy Stocks for 2009 best performers were up 73% (Algonquin Power Income Fund (AGQNF.PK), with dividends) and 60% (Cree Inc (CREE)).

On the other hand, since that portfolio was up 27.5% overall, or 29% more than this one, the best two performers among these gambles did relatively much better than their peers. That's clearly small consolation if you bought this portfolio rather than the less exciting one with my more conservative picks, which outperformed in the harsh economic climate.

I continue to own small stakes in a few of these, in conjunction with covered calls. At current prices, Raser Technologies (RZ) is my favorite, which is why it made my Clean Energy Stocks Shopping List: Landfill Gas and Geothermal. However, it's still a risky stock, and could as easily go down as up.

Given my bearish short term expectations, I expect the portfolio as a whole will end the year lower than it is today. I'm still willing to buy most of these at the right price, but, for most, the right price is significantly lower than the current price.

DISCLOSURE: Tom Konrad has positions in AXPW, EMKR, RZ, and ZOLT.

Comments

[A Barrel Full:]

I love Raser's low temperature geothermal business model. However, as they are using UTC's technology, I don't understand what their competitive advantage is?

If UTC were a small start up on the other hand, and not just a small part of a big company, it could fly on the back of this technology.

Jul 15 08:54 AM

[tc1:]

Raser's continued fall after the close over a week ago of its recent dilutive stock offering is a matter of some concern. Normally a company would begin to recover after such a close of revenue-raising through this means-- the fact that RZ's shareprice has plunged further is NOT a good sign. But then this is a company that has so many detractors and shorters piling on in bearish fashion...

David Phillips just wrote a devastating hatchet job on RZ the other day at 10qdetective.blogspot..... While we need such candid assessments of a company's financial picture, it also appears that Phillips ignored the fact that RZ may get a DOE loan guarantee and ignored the further fact that some prominent Utah political leaders are promoting RZ and, who knows, may step up to help it out of its present heavily indebted condition.

RZ is in dire straits, but could surprise all its critics if it can hang on long enough to get one or two more plants up and running.

This is a high-wire act and makes for interesting times for any investor (i finally got in long at $2.75, after the fall from the high $3s level, but didn't wait long enough to get it at its present <$2).

As for CPTC.OB, who can explain its one-time jump several weeks ago up to $0.48 and then its plunge back down to half of that?

Jul 15 10:19 AM

[stockdoc123:]

It is only a matter of time - it will happen!

Jul 15 11:29 AM