The Solar (and Wind) Stock Also Rises

Big rally yesterday but I was shocked to see so many stocks that had no business going up went up double digit on a percentage basis without any news. The volatility is just nuts. Even some of the worthless ethanol stocks participated in the market rally. Why was iRobot (Nasdaq: IRBT) up?

Fueltech (Nasdaq: FTEK) which I have recommended in the past was up about 14% today. Why? I like FuelTech but wasn’t impressed with the 2Q numbers and the lowered outlook. I was even thinking about picking it up in the mid 20s but not anymore. I am going to look at some shorting opportunities soon. There’s seems to be a lot of opportunity to short out there. Of course, I am only going to use PUTS to short stocks. Just waiting to see what happens tomorrow.

Of course, the Solar Stocks don’t ever waste an opportunity to advance and they didn’t waste today’s opportunity either. Wind Stocks weren’t far behind.

Solar Stocks:

• Now its gotta suck if you own MEMC Electronics (NYSE: WFR). I am actually surprised that it didn’t go up today. It seems like WFR is stuck in the high 50s - low 60s range.
• Suntech Power (NYSE: STP) made another 52-week high today but let’s see if it continues after the company reports Q2 earnings tomorrow.
• Just when you thought the momentum was all but gone in First Solar (Nasdaq: FSLR), it comes back strong in a matter of couple of days. Nothing it seems like can stop this stock from appreciating, not even the sky-high stock price, the valuation, the large amount of insider selling, the secondary, the 2Q results and even the NASD Inquiry.

On August 1, 2007 we received a letter from the NASD Market Regulation Department (the “NASD”) requesting certain information in connection with the NASD’s review of trading in our common stock surrounding our July 9, 2007 announcement of having entered into new long-term supply contracts. Among other things, the NASD requested information about all persons who possessed information about the new long-term supply contracts prior to our public disclosure, a chronology of all significant events leading to the execution of the new long-term supply contracts and a description of our procedures to ensure the confidentiality of material, non-public information prior to its public dissemination. The letter states that the inquiry should not be construed as an indication that the NASD has determined that any violations of the NASD Conduct Rules or the federal securities laws have occurred. We are cooperating with the NASD and are not aware of any inappropriate disclosure or improper trading.

At this point I am just waiting on the secondary to be priced.

Wind Stocks:

• American Superconductor (Nasdaq: AMSC) made it’s 52-week high today. However, the company reports 1Q number tomorrow morning. It would be interesting to see how this fares.
• I picked up Kaydon Inc. (NYSE: KDN) recently after seeing it mentioned on Barrons a few week ago. Did some research on it and really liked it. I was looking for a Wind Energy related stock for a while but didn’t know about Kaydon until Barron’s mentioned it. Look into it.

American Superconductor and Zoltek (Nasdaq: ZOLT) have a great future ahead of them but I don’t think this is the right entry point.

There is shorting opportunity available in some of the Solar and Wind stocks. However, remember there will be long opportunities as well once they drift down. Also, I would only recommend using PUT Options to Short.

Full Disclosure: I own PUT and CALL Options of First Solar (FSLR) (lot more PUTS) and I own CALL Options of Kaydon (KDN)

Comments

[weiwentg]

Fuel Tech's sales are rather lumpy. I'm not losing too much sleep over their low sales this quarter; I'd be far more worried if their sales over the full year were still sluggish.

I compare them in some ways to International Game Tech (IGT), another stock I like. IGT makes, leases, and sells gaming machines. It's the clear leader in its field, but its sales are also lumpy. The stock has been punished this year. I had the good fortune to pick it up for very cheap in late 05, and sold earlier this year. Well, IGT went down even more from when I sold it, and I picked it up again.

Back to FTEK. I don't think they have as wide a moat as IGT. But, they have very promising and very real technology. They are aimed at coal - an existing, very developed industry. They're not seeking to build a whole new industry, like wind, solar, or geothermal. And their executives have significant ties to the coal industry. This is not a fly by night stock. I'm going to try not to lose too much sleep, or pop too much champagne, over the wild swings.

[rcsummit]

Unfortunately, regarding wind energy companies on the move, you left out Americas Wind Energy Corp. ticker AWNE.

[User 132689]

TWRT is very good