Energy Stocks to keen an eye on during this downturn
My first day back from vacation and the market takes its biggest hit in six years. Some of my high fliers such as Suntech Power (NYSE: STP) and FuelTech (Nasdaq: FTEK) have taken a big time beating. Suntech Power has gotten the worst of it being a Chinese company. What this downturn has done is made some quality stocks cheaper and more attractive. I plan to either buy the following stocks or add to my position in the near future depending on the overall market conditions.
Here’s my list (in no particular order):
- Suntech Power (NYSE: STP): Suntech Power has taken a major beatdown in the last three days and I am still not convinced if the beating is over. I am still comfortably up in my position and actually bought a call option on Tuesday as well. I don’t see anything fundamentally wrong with the company and expect it to recover once the market settles down.
- FuelTech (Nasdaq: FTEK): My Fuel Tech position has gone from a nice profit to a small loss in the last three days. The company has won some nice contracts from the Chinese government due to their preparation for the Beijing Olympics. I still see tremendous upside for this company. Hoping to see a bounce before Q4 earnings are announced next week on Tuesday.
- American Superconductor (Nasdaq: AMSC): This company has been on a nice run the last few weeks. Being one of the few pure play Wind Energy stock also helps. I am already up more than 100% on my Jan 08 call options which I am planning to hold for now. One of the few stocks that has been on a uptrend that last three days.
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* Full Disclosure: I am long STP, FTEK, UA, AMSC. I don’t have positions in BA, HDB, IBN, INFY or SIRF.
March 3rd, 2007 at 8:40 am
I keep looking back to March of last year — when solar stocks peaked, and then began a long decline. I still don’t understand what brought that on — unless it was simply the fact that there were a lot of speculators buying solar stocks. With all the talk about ‘Peak Oil’ over the past few years, solar started looking pretty sexy. This type of interest may have inflated solar stock prices beyond their fundamental value — and maybe last summer was a big correction.
But there is something about that explanation that feels off, to me. Wouldn’t a correction in a rapidly growing industry look more like a steep drop-off, followed by continued steady increase?
I’ve been staying pretty loyal to SunTech lately, because I believe they are solid for the long-haul. But I’d hate to see this spring and summer turn out like last year.
By the way, welcome back! Hope your travels were enjoyable.
March 3rd, 2007 at 10:14 am
I think next week will tell us a lot about short term market trend. It was hard to stay loyal to STP this past week. But any further downtrend I think I might consider selling and buying back when the dust settles down. The thing I like about the solar industry is that most of the companies in this sector are profitable. It’s not as speculative as say Fuel cell or Ethanol sector. STP, FSLR, SPWR, WFR, TSL, SOLF are all profitable but since this is a sexy sector to invest and future seems very bright they all might be overpriced a little.
Trip was good but infrastructure in India needs a major upgrade. THere will be a lot of contracts coming up soon and I am trying to figure out which American companies might be able to take advantage of the infrastructure spending in India. GE is the obvious one and Boeing as well b/c Air travel has really taken off in India. Will need to try to figure out what other companies might be involved.
Thanks for taking the time to leave a comment. Let’s hope Suntech starts an uptrend from Monday.