The Long Case for Akeena Solar

| About: Andalay Solar, (WEST)

Akeena Solar (AKNS) is a solar energy company that has a very bright future. I myself am long on Akeena, and its stock comprises well over a third of my portfolio. Several things about Akeena should impress the inquisitive investor:

1.) Firstly, the company’s bank approved a credit line increase of $17.5 million– from $7.5 million to $25 million. This fact emerged in late December, just after I found out about Akeena’s existence. I was already impressed with the gist of what Akeena does– solar installation. While I do not know how quickly I would be willing to call this an economic moat, the huge credit line increase demonstrates the faith that financiers have in the prospects of the company. “They must be planning some kind of significant expansion,” I thought. My interest in the company was acutely heightened.

2.) Akeena has introduced the Andalay, which is a solar panel innovation. The Andalay is unique because of its subtlety and easy installation process. No gigantic racks are required, the device does not overtly look like a solar panel, et cetera. In my mind, the big deal lies in the fact that Akeena is broadening its market by producing solar panels, rather than solely emphasizing its installation.

3.) Lastly, Akeena recently announced a distribution pact with Suntech, a big dog in the solar world (its stock is currently trading at around $56). The announcement propelled Akeena from the $6/7 range up to $15. Suntech is going to take the Andalay and sell it in Australia, Japan, and Europe. This is going to be huge. It seems that Suntech has faith in the viability of the Andalay. Although Akeena is a U.S. company, I honestly believe that it is going to be able to achieve an economy of scale through this deal.

This stock is definitely a Strong Buy. There are going to be some ups and downs as there always are, but Akeena will be a household name in alternative energy within six months. I recommend getting in on it now, while a bottom emerges.

Disclosure: Author is long AKNS

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