February was a pretty good month for Capstone Turbine (NASDAQ:CPST).
The company announced record revenue for the most recently completed quarter, and indicated that the backlog of orders was growing as well, boding well for continued sales increases and guarantees for future revenue streams.
Then, just when it looked like Capstone would be heading right back down into the solid buy territory, a significant order for the company's C65 microturbine units came rolling in to thwart the price decline and return the CPST stock to the $1.50 mark.
What makes the 24-unit purchase even more significant is that this purchase was made in addition to an 18-unit order that took place last August by "one of the world's largest independent oil and natural gas companies," according to a Capstone release issued last week.
Re-orders as significant as this one provide confirmation and assurance that Capstone's products are embedding themselves into the market, an essential element for investors when judging the long term potential of the company.
The 24 microturbines are slated for the Eagle Ford shale play in South Texas, again according to the company press release.
This order also shows that Capstone's low-emission microturbine units are also appreciated by the oil and gas industry, even while green energy companies such as Capstone could be considered as in competition to big oil, as they tend to benefit when oil prices are on the rise and sources of alternative energy move more into the spotlight.
There's always the chance that CPST will retrace back into the lower $1 range, as this company will always be considered speculative while its losing money, but orders such as this one underlie Capstone's potential as a big player in the green energy sector for years to come.
Disclosure: I am long CPST.