Monthly Archives: May 2014

SolarCity: Fanning the Flames

by Debra Fiakas CFA Solar power installer Solar City (SCTY:  Nasdaq) has attracted a swarm of shareholder lawsuits in recent weeks.  The stock is trading at a price level 44% below its 52-week high of $88.35 set in February 2014.  That has to be disheartening for those who were on the wrong side of the trades at those lofty levels.  In February when traders were bidding $88 and change for SCTY, the stock was trading at about 50 times revenue and 47 times cash flow from operations.  Of course, since the company had yet to produce...

Investing In Solar Innovation

By Jeff Siegel The road into the digital age has been paved with innovation. Everyday items have been electrified with panels and displays for endless possibilities of interaction. Automobile windscreens, household appliances, even walls and furniture are lighting up all around us, wired with sensors and displays that receive and transmit information. It seems the only surface left to electrify on this road to an everything-digital future is the roadway itself. Some folks believe one day soon, your local road network could be carrying not only the flow of vehicle traffic, but torrential flows of digital data and...

Private Equity Giant Eyes Chinese Solar

by Doug Young Following reports last month of the imminent formation of a major new private equity investor, media are now saying the company, China Minsheng Investment, has formally registered and is gearing up to make its first investments. The new company certainly has the resources and connections to quickly become a major player on both the domestic and global private equity scenes, with an initial 50 billion ($8 billion) in registered capital. Now it appears the company will start by helping to consolidate China’s embattled solar panel-making sector, which will become its first focus area....

The Very Quick Guide To A Green Portfolio

Tom Konrad CFA For many, the decision to get out of fossil fuels is an easy one.  It may be because it's the right thing to do, or because we see the risks of investing in businesses built around an unsustainable economic paradigm.  This article is not about that decision; it's about what to do next. The Green Portfolio: What And Why To a lesser extent, it also depends on what we mean when we say "green."  For simplicity, this article will focus on making your portfolio Fossil Fuel Free (FFF), meaning that the portfolio should...

NovX21: Urban Miner

by Debra Fiakas CFA There's Platinum in them catalytic converters. Mention platinum and most of us think about beautiful and expensive jewelry.  However, platinum can be found in the dullest of products.  Catalytic converters used in automobiles for emissions control represent about one-third of the demand for platinum. The devices attached to the rear of our cars uses a mix of previous metals to remove nitrogen oxides, carbon monoxide and hydrocarbons from engine exhaust.  The catalytic converter on a typical car uses a gram or less of platinum,...

The Solar PV Shipment Shell Game

by Paula Mints Outsourcing has been a common practice in the photovoltaic industry since…always. Ignoring it in favor of reporting higher shipment numbers has been a common practice since…always. There is more outsourcing now than there was ten years ago because the industry is bigger. When the PV industry was at megawatt levels, outsourcing was at megawatt levels. Now that the industry is at gigawatt levels, outsourcing is at gigawatt levels. Today’s outsourcing is also more acceptable in the past everyone did it quietly, today it is out in the open. Yet despite this openness and acceptability,...

Obama’s Next $2 Billion For Energy Efficiency: How To Take The Money And Run

By Jeff Siegel It's all about the money. I don't care how you slice it  when it comes to investing, personal politics are irrelevant. This has long been how I've approached wealth creation, and it works quite well. Even as I denounced the continued reliance on outdated and economically inferior energy and transportation systems (i.e. the internal combustion engine and tar sands production), I make no apologies for profiting from new opportunities in fossil fuels. My gains in shale over the past few years alone are reason enough to stick to this strategy. Of course, when I'm given...

Spring Blossoms: Amyris First Quarter Earnings

Jim Lane Lily flowered tulip 'Maytime' photo by Tom Konrad In California, Amyris (AMRS) announced net income of $16.4M on revenues of $6.2M for Q1 2014, after reporting a $32.6M loss in Q1 2013 on revenues of $9.0M. The change in net income was primary due to a non-cash benefit relating to outstanding convertible notes, a result of a decrease in the Company’s stock price at 3/31/14 compared to the stock price at 12/31/13. In a release accompanying the results, the company highlighted that it: Achieved combined...

It’s Easy Being Green. Fossil Fuel Free Is Harder

Tom Konrad CFA Disclosure: Long BEP, MCQPF. PENGF, AQUNF Last week, I was surprised to discover that Brookfield Renewable Energy Partners (NYSE:BEP, TSX:BEP-UN) is not entirely renewable. I’ve owned shares of Brookfield for many years, but as a relatively safe income stock, I’ve parked it in the back of my portfolio to gather dust and dividends. I apply my limited time for in-depth analysis to riskier stocks where a quarter’s earnings are likely to make a much bigger difference in the stock price. I may have noticed the “Other” category in addition to BEP’s wind and hydroelectric generation...

SolarCity: Sunburn, or Healthy Glow?

By Harris Roen SolarCity (SCTY) fell 9.1% Wednesday when the company released its first quarter earnings report, but gained all of it back and then Thursday on huge volume. Still, the stock has plummeted 22% in three months, and is down 37% from its highs in February 2014. Is this just a healthy correction from its outsized 400%+ gains from the IPO just 17 months ago? Or have we entered into a new lower trading range more in line with financial realties? This article will analyze current developments to this distinctive energy stock, and project where...

Renewable Energy Stocks By The kWh

Tom Konrad CFA Disclosure: Long BEP.  Short PEGI $20 and $25 puts, short PEGI $30 and $35 calls, short NYLD $40 and $45 calls. I recently sized up five renewable energy power producers using the metric that’s most often used for solar panels: Dollars per Watt ($/W).  It’s an intuitive metric, but has serious flaws both for evaluating solar installations and stocks.  Slightly better is Watts per Dollar (or W/$100 to make the numbers look nice) as shown in the chart from that article below. The main advantage of W/$100 over $/W is that it’s additive: I can meaningfully...

Flying into the Sun

by Debra Fiakas CFA Shares of two solar panel producers appeared on one of our favorite stock screens the other day  -  energy stocks that have traded downward to a point they appear oversold.  Trina Solar, Ltd. (TSL:  NYSE) recently closed at $11.22, down 39% from its 52-week high set in early March this year, but well above where the stock was trading a year ago.  RenaSola, Ltd. (SOL:  NYSE) has followed a similar track, recently closing at $2.61 well above its 52-week low.  The question for investors is whether investors should take advantage...

Renewable Energy Stocks By Dollars Per Watt

Tom Konrad CFA Disclosure: I and my clients own HASI and BEP. I have short call positions in NYLD and PEGI, and short put positions in PEGI. Dollars per watt ($/W) is a lousy measure of the economics of solar, but it persists. Most likely, it persists because it seems familiar.  We can pay $4 for a watt of solar, or $4 for a Iced Hazelnut Macchiato at Starbucks.  Unfortunately, while the analogy may seem apt, this is a lot like knowing you’re getting a Macchiato without knowing if it’s a Tall, Grande, or Venti.  The actual energy production from a...

Offshore Wind A Big Part Of Why GE Wants Alstom

Who's the Energy Alpha Dog? GE or Siemens? By Jeff Siegel General Electric (NYSE:GE) wants to acquire one of the largest companies in France, and it could get what it wants if Germany doesn't get in the way. Alstom SA (AOMFF), the target of GE's desires, is a French energy and transportation company with a market value of approximately $11.5 billion. It deals in hydroelectric and nuclear power, environmental control systems, wind turbines and battery storage, as well as trains and rail infrastructure. It's a huge company, and GE could spend as much as $13 billion to...

Why Traffic Lights Are Turning Green For BioAmber

Jim Lane As many technologies pivot or delay, one train keeps chugging on its route to biosuccinic acid, and markets like BDO, resins and polyols. What is it about the business model that keeps on working? What can every integrated biorefinery learn from its approach? In Minneapolis, BioAmber (BIOA) just announced a contract to supply a minimum of 80% of PTTMCC Biochem’s total bio-succinic acid needs until the end of 2017. PTTMCC Biochem is a joint venture established by Mitsubishi Chemical and PTT, Thailand’s largest oil and gas company, to produce and sell polybutylene succinate (PBS),...

Ten Clean Energy Stocks For 2014: May Update

Tom Konrad CFA April showers fell on both the broad market and clean energy stocks last month, but my picks weathered the storm relatively well.  My clean energy benchmark (PBW) was down 5.9% since the last update, and my broad market benchmark (IWM) fell 1.7%.  Meanwhile 10 Clean Energy Stocks for 2014 model portfolio also fell 1.7%.  For the year so far, the clean energy benchmark is up 4.5%, having given back most of its large February gains, while the broad market is down 2.5%.  My model portfolio is up 2.2%, having...