From Thomas Edison to Wave Power to Chinese Solar Imports to the ‘Air Car’

Random highlights on alternative energy taken from recent Internet postings:

 From Zimbio.com, a reminder that Thomas Edison is credited with not only inventing the light bulb, but he also designed an electric car battery (http://www.zimbio.com/Electronics/articles/Pu-dbQkqAzU/New+Lithium+ion+Batteries+Worked+Nissan+NEC). Edison released the first nickel iron battery in the 1900s as a cheaper alternative to lead acid batteries “with better reliability and longer life,” and was first used in electric cars around 1920, according to Zimbio. Today, the Nissan Motor Company and the NEC Corporation are working together on developing a lithium ion battery for hybrid and all-electric vehicles that will be a “breakthrough technology to make the auto industry even greener.” Their chief competition may be two other Japanese companies: Toyota and Matsushita Electric Industrial Co.

Pennington, NJ-based Ocean Power Technologies (Nasdaq: OPTT, http

Mini CAT passenger version photo courtesy of greencar.com

://www.oceanpowertechnologies.com/) a pioneer in wave-energy technology that harnesses ocean wave resources to generate electricity, announced July 13 that they will team up with Lockheed Martin (NYSE: LMT) to develop a 19-megawatt wave energy project in Australia. Dubbed as one of the largest wave-energy projects ever, it is based on a grant from the Commonwealth of Australia. Both companies apparently see a future for wave energy, which according to the World Energy Council has the potential to produce about 2,000 terawatt hours of electricity a year or enough to meet 10 percent of the world’s current energy needs. OPTT stock got a big boost from the announcement, up to nearly $4 but then fell back. At close of market July 17 it was trading at $2.63, down 4 cents on the day. Its 52-week trading range is $2-$5.60 and market cap is $27 million.

Squeezetrigger.com, a website service dedicated to “help bonafide shareholders of publicly-traded US companies fight short selling,” filed a post July 17 suggesting six stocks are “ripe to go up in the next five weeks.” (http://delayedquotes.cboe.com/news/news_story.html?idnews=238966436&ASSET_CLASS=&ID_OSI=&ID_NOTATION=) The prediction is based on the stocks “high probability” to go up based on “seasonal tendencies.” Squeezetrigger has built a database that allows it to analyze more than 20 years of data to predict seasonal bias. One of those stocks is a smallcap, Milton, GA-based Exide Technologies (Nasdaq: XIDE, http://www.exide.com), a leading lead acid battery manufacturer. At close of market July 17, XIDE was trading for $3.37, up 5 cents for the day. XIDE stock has a 52-week trading range of $2.22-$7.89 and a market cap of $263 million.

The Coalition of American Solar Manufacturing announced that imports of Chinese solar cells and panels decreased in May, the second straight month there has been a decrease compared to the same month in 2011. The U.S. Department o Commerce report showed that Chinese solar imports totaled $124.1 million in May, down 45 percent from $225.8 million in May 2011. The reason? The coalition suggests the totals reflect “the market’s rising recognition of the costs, risks and uncertainties associated with importing Chinese solar cells and panels.” For the full year 2012 through May, however, Chinese imports are still ahead of 2011: $1.21 billion in 2012 compared to $993.2 million in 2012.

Finally, look for Tata Motors “Mini CAT,” also known as the “Air Car” to debut in August (http://www.caradvice.com.au/141944/tata-motors-mini-cat-air-car-to-debut-in-2012/). Correct, it’s a car with an engine that runs on compressed air. The Mini CAT has a tubular chassis, a fiberglass body glued, not welded, with a microprocessor controlling all its electrical functions. One small radio transmitter works the lights, turn signals and other electrical devices, which are few. Cost of the car is expected to be about $8,200 U.S. Also, the car has an access card instead of keys and is expected to cost about $1.12 per 100 kilometer to operate. Top speed is about 60 mph and its range is about 185 miles between stops at special air compressors for refueling.

Small Caps Hoping for Lift from Booming U.S. Auto Sales

The month of May was a bummer for most investors, judging on the big hit all the major indexes took. But not for the nation’s Big Three automakers: Ford, General Motors and Chrysler, according to Marketwatch (http://www.marketwatch.com/story/big-three-auto-sales-roar-in-may-2012-06-01?siteid=bnbh). With the help of

Photo courtesy of Port Clinton Ford

 

looser credit demands for buyers, all three posted double-digit sales growth, according to the story, which was picked up by most major news outlets.

For General Motors, May 2012 was the best month of sales since August 2009 and 11 percent better than a year ago. GMC vehicles and Buick were up 19 percent and Chevy was up 10 percent, noted the Marketwatch piece. For Chrysler, which is adding production capacity “as quickly as possible,” it was the best month in five years. U.S. sales for Chrysler rose 30 percent in May and Dodge posted its 26-th consecutive month of year-over-year sales growth, the Marketwatch story noted.

Ford’s U.S. sales rose 13 percent led by the F-Series and E-Series trucks and the Fusion.

We’ve been covering a random mix of small cap auto dealerships and automotive-related companies that are suppliers, parts makers and partners of the major OEMs. Here’s a look at how they are faring: 

Duluth, GA-based Asbury Automotive Group (NYSE: ABG, http://www.asburyauto.com/) operates 79 auto dealerships in 18 metropolitan markets in 10 states. More than half of the dealerships are Toyota or Honda dealerships. Two months ago when we first looked at ABG it was trading at nearly $27. It closed June 4 at $24.30, down 49 cents on the day. Market cap is $766 million, 52-week trading range is $14.96-$29.62..

Bentonville, AR-based America’s Car Mart (Nasdaq: CRMT, http://www.car-mart.com/) sells older model used vehicles and vehicle financing at 113 dealerships in nine states. About two months ago CRMT was trading at just less than $44. It closed June 4 at $40.95, down $1.05 on the day. CRMT’s market cap is $384 million and 52-week trading range is $25.81-$48.24.

Houston-based Group 1 Automotive (NYSE: GPI, http://www.group1auto.com/) sells new and used cars, light trucks and auto parts, vehicle financing and insurance.  It owns and operates 131 franchises offering 31 automobile brands with 104 dealership locations, 25 collision centers in the U.S. and an additional five dealerships and three collision centers in the UK. As recently as April 3 it was trading for $59.15. GPI closed June 4 at $48.26, up 19 cents for the day. GPI’s market cap is $1.04 billion and 52-week trading range is $33.31-$59.97.

Charlotte, MI-based Spartan Motors (Nasdaq: SPAR, http://www.spartanmotors.com/) makes motor vehicle chassis and bodies for OEMs. Its stock was trading at about $5.50 last fall but has dropped pretty steadily since. SPAR had a good day June 4 when the stock closed at $4.43, up 23 cents for the day. The Wall Street Cheat Sheet recently picked SPAR as a company “to watch” based on the GM results and the general automotive industry. Market cap is $150 million and 52-week trading average is $3.65-$6.67.

Milton, GA-based Exide Technologies (Nasdaq: XIDE, http://www.exide.com/) manufactures lead-acid batteries for transportation and industrial energy applications. A year ago XIDE was trading in the $7.50 range, but has been punished by investors for disappointing Wall Street. The stock closed June 4 at $2.35, up 6 cents on the day. Its market cap is $184 million and 52-week trading range is $2.22-$8.

Northville, MI-based Amerigon * (Nasdaq: ARGN, http://www.amerigon.com/) makes a heated and cooled seat system now featured in 54 vehicle models manufactured by Ford, GM, Hyundai, Toyota, Nissan, Land Rover and Jaguar, as well as a cupholder for Chrysler.  Amerigon, which recently announced the acquisition of its main competitor, W.E.T. Automotive Systems of Germany, dropped as low as $6 in 2010 and then ran up as to highs of more than $18 last summer. But the market downturn has hit ARGN and its now trading just off its 52-week low. It closed June 4 at $12.05, up 21 cents on the day. Market cap is $356 million and 52-week trading range is $11.41-$18.18.

Racine, WI-based Modine Manufacturing Company (NYSE: MOD, http://www.modine.com/) manufactures a variety of thermal management products including radiators, engine and transmission oil coolers for the auto industry. This is the stock that Seeking Alpha in November 2010 listed as one of “10 Stocks on the Upswing.” It’s been on a downswing for the past year, considering last July it was trading for about $16 and closed June 4 at $5.73, down 21 cents for the day. Market cap is now $267 million, 52-week trading range is $5.67-$16.02.

* Denotes client of Allen & Caron, publisher of this blog

Surge of Students Seeking Science Studies

Is it the impending doom of global warming? The popularity of President Obama? The advent of environmentalism? The enormity of the global economic crisis? More likely, experts say, it’s a confluence of all these events that has prompted what they call a “surge” of students toward “clean energy” careers. The rush of our best and brightest into science and engineering studies is being compared to the late 1950s, when the Russian Sputnik satellite prompted a similar swelling of those ranks, according to the Los Angeles Times (http://www.latimes.com/news/nationworld/nation/la-na-energy-students29-2009mar29,3,2984851.story).

No doubt many of these students would have opted for lucrative business school degrees and Wall Street jobs just a few years ago. But the Obama administration is banking on the idea that federal aid included in the stimulus package will help stoke the interest in innovative clean energy concepts. The package includes $20 billion to support basic science research, according to the Times.

While this doesn’t precisely translate into a boost for smallcap stocks, it does prompt a look at some innovative small companies in various clean energy fields. Two unique solar energy companies are Marlboro, MA-based Evergreen Solar (Nasdaq:ESLR, http://www.evergreensolar.com), a pure solar play known for its “string ribbon” technology using thin strips of multi-crystalline silicon that is cut into wafers that make up solar panels. Or Littleton, CO-based Ascent Solar Technologies (Nasdaq: ASTI, http://www.ascentsolar.com), a maker of thin film, flexible solar modules.

An interesting battery maker is New Castle, PA-based Axion Power International* (EBB: AXPW, http://www.axionpower.com), which has developed an advanced version of the traditional lead acid battery the company believes can play an important role in the burgeoning electric and hybrid car markets. Details on Axion’s PbC battery technology was recently covered in The Economist (http://www.economist.com/science/tq/displaystory.cfm?story_id=13174459). Another smallcap is Tampa, FLA-based UTEK Corp.* (Amex: UTK, http://www.utekcorp.com), a consulting firm that tracks innovations around the globe for a variety of high-profile clients and a leader in the modern “open innovation” movement.

*client of Allen & Caron, publisher of this blog