I certainly got a dose of that bitter pill when I first began studying energy markets back in the early 1990s.
You see, the more I read and the more I learned, the more I wasconvinced that this very dangerous and unsustainable fossil fuelfoundation on which our energy economy was built would ultimately leaveus vulnerable to economic and environmental catastrophe. There was no swaying my belief that alternative energy solutionswere the only way by which we could avert disaster. So I began sharingwhat I had learned, and I also jumped on a few early alternative energystartups that, well, went belly up.
Now understand that these were not bad companies… Management was always top-notch; the technology was about asadvanced as it came back then; there was definitely some big moneybacking these operations. In fact, most of the guys I knew back thenare now major players in the alternative energy industry. But none of that mattered back then. Because, while it was obviousto me that we would not be able to quench our future thirst for energywith only conventional fossil fuel resources, no one else seemed toknow it — or even cared to discuss it.
The fact is back in 1993-1994, you would’ve been hard-pressed tofind more than a dozen investors who knew about peak oil, theliquidation of natural capital, or the billions in subsidies that have kept the fossil fuel machine purring for all these years.
You weren’t going to read about this stuff in Newsweek; youweren’t going to hear it from the major news organizations, and youknow damn well the politicians weren’t going to bring it up.
But all that has changed. And today, there’s a wealth of dataavailable for any investor willing to take the time to do the research.Not to mention, literally hundreds of alternative energy stocks to choose from.
Of course, there is one thing that hasn’t changed — and that’s the importance of timing.
Is the Timing Right for these Green Chips?
In 2009, timing allowed us to help a lot of investors make a lot ofmoney. Especially in energy efficiency, where our Comverge (NASDAQ:COMV) play delivered gains in excess of 145.5%, and our EnerNOC(NASDAQ:ENOC) play finished the year with a gain of 321.07%.
But as the year came to close, I began cautioning against a marketthat was just getting too hot — especially considering the still veryvolatile global economy.
This is the reason editors Nick Hodge, Sam Hopkins, and I have only provided coverage on a few stocks so far this year.
Bottom line: The timing simply hasn’t been right for the kind ofbuying spree we witnessed last year after the market bottomed out.
But it’s getting pretty damn close again. Especially in solar, wherean overreaction to a German feed-in tariff cut put additional downwardpressure on a broader market-driven decline…
It was a double whammy that has pushed a number of quality solar stocks down to some pretty attractive levels.
Especially the Chinese players.
You see, while a cut in the German feed-in tariff (which isabsolutely necessary if you want to avoid a massive bubble) will notmake life easy for German manufacturers, the Chinese manufacturers —with their significant pricing advantages — will inevitably benefitfrom new market share.
The first half of this year will still be a bit bumpy. But by theend of the year, it will be many of these Chinese players profiting bigtime from Germany’s solar market — this, by the way, is notinsignificant.
This is a very pro-solar country, representing about 50 percent ofthe global market for photovoltaics (oddly enough with nowhere near thesolar potential as in the United States), a pro-solar government, andpro-solar banks with relatively deep pockets for financing.
So in an effort to capitalize on what is sure to be a continuationof China’s solar dominance going forward, we’re looking to pick upshares of the following Chinese solar stocks on major dips:
Yingli Green Energy (NYSE: YGE)
JA Solar (NASDAQ: JASO)
Canadian Solar (NASDAW: CSIQ)
Suntech Power (NYSE: STP)
Trina Solar (NYSE: TSL)
Atcurrent levels, I have little doubt that these stocks will delivergains of anywhere between 10 to 30 percent by summer — assuming themarket doesn’t implode again. And for sake of clarification, I wouldn’t necessarily cross that off as a possibility, either.
Again, it’s all about timing.
But while it’s impossible to pinpointthe bottom with complete accuracy, it doesn’t take a rocket scientistto know a bargain when you see one.
And as we learned last year, those who are in it for the long haul — and can exercise a little patience — will be rewarded.
To a new way of life, and a new generation of wealth…
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