ENER - Sector: Technology---Industry: Semiconductors

[RichL74]

Another great day for this stock. I've dipped into my margin and bought some more. Will hold margin shares till 40. Should not be too long. I've never experienced this kind of ride with any stock. Hope oil prices hold, which will put the pressure on for more alternative energy sources.

[RichL74]

So I didn't think the lowering of oil prices would lower this stock or was it just simple profit taking? Either case, I bought some more shares to today near @ $33.75. Hope it bounces back to 35 - 36 level this week.

[cumulina]

When are we going to see more images like this? 



It is a very small part of the energy-market, but the growth is there 



Suddenly, Those Solar Panels Don't Look So 1970's

By TIM GRAY
Published: September 11, 2005
AS prices for coal, natural gas and oil have soared, solar power has been getting perhaps its most serious look from investors since President Jimmy Carter pulled on a cardigan and asked Americans to damp their furnaces. The new interest means that the handful of domestic solar stocks has been surging, too.

Sold on the SunOver the last year, the shares of Evergreen Solar, DayStar Technologies, Energy Conversion Devices and Spire - all small domestic companies that make equipment for converting solar power into electricity - have more than doubled in price. In August, Cypress Semiconductor said it would try to raise as much as $100 million in an initial public offering for its SunPower subsidiary.

"The solar market is projected to grow 35 percent a year for the next three to five years," said Walter V. Nasdeo, managing director of Ardour Capital, an investment bank in New York that specializes in energy companies. "As these technologies get better, we're seeing things being developed like solar panels integrated into roofing tiles. That way, they don't look like a science project hanging on your roof."

Back in the days of President Carter's cardigan, the country was mired in an energy crisis, with an oil embargo and long lines at gas stations. Today, tumult in oil-producing places like the Middle East and Venezuela is roiling markets. Strong demand for electricity has contributed to increases in the prices of coal and natural gas. And Hurricane Katrina, of course, has worsened the situation. Yet these dire developments have been a boon for companies that make devices such as silicon wafers and rooftop panels that convert solar energy.

Until recently, the economics of the solar business did not tempt many consumers or investors. Without government or utility subsidies, the $20,000 to $25,000 that it costs to buy and install a typical home solar system may be too much to be recouped in the time it takes to pay off a 30-year mortgage.

But government help, combined with the recent climb in energy prices, has made solar systems more appealing. Some states offer big subsidies, helping to defray much of the initial cost of a home system.

Some electric utilities also offer incentives. In theory, solar systems free them from having to invest in additional power-generation capacity. Homeowners typically connect their systems to the power grid and buy electricity when their panels don't produce enough power and sell it to their utility when they have a surplus.

Federal law requires utilities to buy excess power generated by consumers' solar power systems - though rates vary from state to state, said Joseph E. Schwartz, chief executive and technical editor of Home Power magazine. And the new federal energy law, signed by President Bush last month, includes a tax credit of as much as $2,000 for the purchase and installation of a residential solar power system.

"Despite all of the concerns about imported oil and climate change, most people make their decision to install solar based on whether they're going to save money," said Steven C. Taub, director of emerging-generation technologies at Cambridge Energy Research Associates. In states with generous subsidies, he said, solar power systems may be attractive for many consumers. In New Jersey, for example, subsidies can cover up to about 70 percent of the cost - leaving consumers with a net cost of about $6,000 on a typical home system.

Though the four little domestic solar power companies stand to benefit from new demand for power, they account for only a small fraction of the world's solar-device production. The biggest of the four, Energy Conversion Devices, has a market capitalization of only about $1.1 billion.

Giants like BP and Royal Dutch Shell in the energy industry, or Sharp and Kyocera in electronics, make most solar gear. Last year, the solar industry produced 1,195 megawatts of new electricity-generation capacity - about the equivalent of one large power plant, Mr. Taub said. Sharp alone accounted for about 325 megawatts, he said.

Yet solar energy conversion is a tiny part of these hefty companies' sales, so the little independents are a purer play. The business lines of Evergreen and DayStar are almost entirely related to solar power (as are those of Cypress's SunPower). Energy Conversion Devices has other products, but its largest subsidiary, United Solar Ovonics, also known as Uni-Solar, is a solar power business. And Spire's solar division accounted for an average of 40 percent of the company's sales in 2003 and 2004.

Of course, investing in small-capitalization stocks can be risky. Besides being microbes in an industry dominated by giants, none of the four independents were profitable last year. Two have short histories as public companies: Evergreen went public in 2002, and DayStar did so last year. All but Spire are developing new solar technologies, and there is no guarantee that customers will embrace their innovations.

Sold on the SunThe most popular means of converting the sun's energy into electricity - silicon-based solar panels - has progressed over the last three decades but hasn't changed radically. Silicon is used to make wafers, which are wired to create solar cells. These form the building blocks for solar panels, which look like big storm windows, sit atop roofs and soak up the sun.

A silicon shortage has driven up the cost of solar-grade silicon by more than 60 percent over the last two years, said Michael Rogol, an analyst at Credit Lyonnais Securities Asia. That offers an opportunity to companies like Evergreen and SunPower that have devised more efficient ways to use silicon, he said.

Evergreen's wafer-making method consumes about a third less silicon than usual, said Richard M. Feldt, its president and chief executive. Many competitors saw blocks of silicon into wafers; that creates waste in the same way a lumberyard spits out sawdust. Evergreen's method, which draws out long ribbons of silicon and slices them with lasers, produces less waste.

EXECUTIVES at Cypress Semiconductor in Sunnyvale, Calif., declined to be interviewed because of the impending stock offering. But Mr. Rogol says its SunPower unit makes the industry's most efficient cells, yielding 210 watts of power a square meter, versus 180 for a typical cell.

DayStar, for its part, ditches silicon entirely, while Uni-Solar uses far less than average. DayStar, based in Halfmoon, N.Y., applies a thin film of several elements, including copper, to backings such as titanium foil to create flexible solar cells.

Uni-Solar marries the thin-film method with silicon. "Our panels are typically 18 feet long with an adhesive on the back," said Subhendu Guha, its president. "You can stick it directly onto the roof. With the traditional product, you have to have a support structure."

Spire, in Bedford, Mass., produces neither silicon wafers nor solar cells. It makes machinery for building and testing solar panels. In 1999, that enabled it to team up with the city of Chicago to equip and run a panel factory there. Roger G. Little, Spire's chairman and chief executive, says he sees the Chicago venture as a harbinger of Spire's future; he aims to increase panel production over the next two years.

That would return Spire to its roots. The company started in 1969; early on, it concentrated on solar power conversion. It diversified into biomedical equipment and electronics after energy crisis of the late 1970's abated and enthusiasm for solar power cooled. "The market tanked," Mr. Little recalled. Even so, he remained confident.

"I've always believed that solar is a freight train that can't be stopped," he said. "It started small, but the compound annual growth rate for the last 10 years has been 20 percent. This year, there's a $10 billion worldwide market for systems."




...or if you prefer this...




Now...for the financials of these companies, you'll have to ask someone else - I have a tough enough time just balancing my checkbook, let alone evaluating if a business is financially sound or not!

DSTI has been on the 3sof list, and it did well.
I have been holding ENER and ESLR for a while now, and they have are up 20.87% and 32.08%.

And I don't see this trend changing any time soon 

I'd be very interested in comments about these stocks.

Have a nice weekend.

[robt]

Thanks a ton for bringing this to my attention!

Monday will be very interesting for alt energy, Associated Press also jumped on the bandwagon, with the headline "Alternative fuel stocks skyrocketing"

http://www.miami.com/mld/miamiherald/business/national/12612250.htm

The Times article is an even better boost, as those guys are taken seriously!

One thing everyone should keep in mind as solar becomes a momo play, is that solar's time has not yet come!

First of all, the industry is currently hampered by a worldwide shortage of silicon, that will last throughout this year, and possibly into 2008! See:

http://www.wired.com/news/planet/0,2782,67013,00.html

http://news.zdnet.com/2100-9584_22-5670629.html

DSTI, it should be noted, has developed a silicon-free solar cell.

Secondly, solar is still wildly expensive, to an extent that government subsidies are of little help.

You can price a Spire residential system online:

http://www.spiresolarflorida.com/tools/tools.html

A 1 kW system, generating $112 worth of energy per year (by Spir's calculations), is $10,000. (2 kW is 20k, 3 is 30k, etcetera...no bulk discount).

Pays for itself in 90 years, at typical energy cost of 8 cents per kWh.

And that's assuming you don't need to replace solar panels after a hurricane.

Maybe with the energy bill's help, and with a huge increase in electric rates, these systems will pay for themselves in 50 years.

Spire Corp is the cheapest of the lot mentioned in the Times, and has increased its share price 250% in 3-4 months. Spire has worked great for me as a short play off of its recent spikes, though I've also played it long.

Unlike the other companies covered, SPIR actually showed a profit in its most recent quarter. This gives SPIR fantastic short potential, as its profit came from two non-recurring sales of technology licenses. Their next earnings report seems certain to bring another deep loss.

I started a SPIR thread, found here:

http://www.3stocksonfire.org/trading/index.php?topic=2634.msg20537

[cumulina]

Good post, robt...and interesting links. Thanks - and applause.

Yes, today will be VERY interesting indeed. The yahoo-boards are brimming over with excitement...

Today at 4:45 there will be a cc for ENER:

http://biz.yahoo.com/cc/3/59973.html

I shall be glued to it! 

I see no problem with the chart either 

[RichL74]

I'm going to hold this stock until oil drops down to $55. When that happens I think some of the short term investors will be out and the price of this stock will settle. Go ENER!

I also see coverage initiated by a couple new investment firms as the pressure to use alternate energy becomes mainstream.

[RichL74]

So what will it take before David makes this stock as part of the portfolio. This stock does nothing but go up up up! Somebody should tell him, chart or no chart.

[stocky]

RichL have you been on Yahoo Message Board SNDK, about year and a half back?

If yes let me know

[RichL74]

RichL have you been on Yahoo Message Board SNDK, about year and a half back?

If yes let me know

Stocky, can't say I have. I don't usually post on Yahoo. A lot of pump and dump and not a whole lot of insight. People with their own agendas and do not offer objective analysis on any stocks.

I do post quite a bit more here on this site as I don't see a whole lot of BS going on here.

Just to update my position on this stock, I have 2200 shares and looking to buy more. With Rita about to hit the gulf and expected to be a category 4 hurricane when it hits Texas, you can be sure that oil prices will rise above 70 some time next week. With Phillipe not far behind Rita, you know it's a given that there's going to be a lot of hedging from investment firms and oil companies. One of many ways for the oil companies to invest in the recent rise and the substantial profits this year is to take a look at the alternative energy sector.

Look for continued strength in the alternative energy sector as gas prices faces the previously stated inflationary pressures. I will still continue to invest in this stock until oil prices fall to $55 / barrel.

Not to spur any rumors, but with the recent buyout attempts of American companies (Unocal, Maytag), ECD would be a kind of company they would like to invest / purchase for their own. This article really hits it home ...

http://www.wired.com/wired/archive/13.04/china.html?pg=1&topic=china&topic_set=

[RichL74]

Has anyone else invested in this stock? I would like to know if anyone on this board has seen the upswing of this stock. It has been one amazing month.

[cumulina]

Hi, RichL74.

Glad to see that you're still holding...and if you are waiting for oil to hit $55.- then you might be holding for a good while 

ENER might just hit $55 before oil does  ...how would you like that? 

I have had to sell, and I'm looking to get in again when ENER drops a bit. But it doesn't show any signs that it's about to do that

I really don't understand why we are such a select few who are interested in ENER 

Good luck to you, but I really hope ENER dips so I can get in again!

Cheers.

[ehos]

Hi!
Great pick!

I'm curious why you sold??

[cumulina]

I sold partly because I have been changing accounts around - most certainly NOT because I don't like the stock!

That was really bad timing on my part...

I shall be back in, just don't know when.

http://finance.yahoo.com/q?s=ENER

I think it's one of the best stock I've ever owned!

Cheers.

[cumulina]

  Doesn't look like I'll be buying ENER today! 

43.75 - 44.00 in pre-market...

Have a nice trip guys....

[RichL74]

As expected, an analyst finally initiated coverage on ENER. Piper Jaffray initiated coverage and gave ENER an outperform rating. I think more analysts' opinions will come soon.