Shares of Hoku Scientific on Fire
Hoku Scientific, Inc. (HOKU) is a recent addition to my stock watchlist. HOKU designs and manufactures membrane electrode assemblies (MEAs) and nonfluorinated membranes for proton exchange membrane (PEM) fuel cells. Basically they are developing the next generation of proton exchange membranes. They have strategic relationships with Sanyo Electric and Nissan Motors and are based in Hawaii.
The company received some good news from some financial analysts this week and the company is up over 50% in the last two days.
Piper Jaffray analyst Jesse Pichel said Hoku is one of the best-positioned component suppliers to the emerging fuel cell industry. Pichel said its proprietary technology has the potential to enable lower cost and better performing fuel cells, thus improving commercial viability. The analyst estimates Hoku is working in a stationary and automotive fuel cell market worth around $150 million in 2005, rising to around $2.6 billion by 2012. [ more ]
I'm not ready to commit money to this name right now. I feel that a 50% move like this in 2 days needs some time to digest in the marketplace. I would feel very comfortable buying this name if it can fill the gap back down to the $7 level. It is also interesting that I have heard about this company from 3 different sources in a 1 week time period, so it has hit the radar of many investors recently. For right now, I'm just watching.
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