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Follow the President
03/17/2006 12:00 am EST
"President Bush has been focused on promoting the government and private industry's role in developing technologies to make the US as energy independent as possible," notes Neil George, who offers a pair of plays to benefit from this focus.
"Altair Nano (ALTI NASDAQ) is our latest buy recommendation in the alternative energy field. Nanotechnology is the manipulation of materials and processes at the atomic scale. This technology is having a profound impact on many of these technologies including fuel cells, photovoltaics, and batteries. While fuel cells and photovoltaics are the sexiest ‘green’ technologies, the complete transformation of the lowly battery is upon us, and it will have enormous impact throughout society.
"Conversion to solar power or fuel cells is a long-term societal process. However, batteries are already ubiquitous; changing from one style to another is far less dramatic for consumers. Through its origins as a performance materials manufacturer, Altair Nano has established a revolutionary lithium ion battery—the sine qua non of rechargeable batteries for consumer portable devices—that charges faster, holds charges longer and can outperform nickel cadmium—its industrial competition— in sheer strength.
"So far, Altair Nano has inked a deal with China to develop electric busses for the 2008 Summer Olympics. China is hoping to host the first ‘Green Games’ by having everything possible run off non-fossil fuels. It's also developing batteries for power tools and has just opened a facility in Indianapolis, where all the major hybrid/fuel cell engine work is being done in the US, to expand its technology into the US transportation industry.
"This trade is playing off the timing of the Bush administration's newest initiatives and the increasing visibility of the company and its officers on Wall Street and in the halls of Congress. Be disciplined with the buy target—don't chase it. And be prepared for some volatility, this is a small stock that's easy to move— for good and bad. We'll keep our eyes on it and let you know when it's time to walk away; keep a cool head. Buy below $3.35 a share."
"Meanwhile, on the alternative energy front, there's really nothing else that makes economic or business sense as much as wind power. This is why in just the US, capital investment flows into alternatives last year were more than half of all cash devoted to every kind of non-traditional power source. That is why we own Vestas Wind Systems ( VWSYF Other OTC).
"Everybody in the industry knows the company makes the best stuff. Even its competitors, including General Electric, say it has some of the best in the business. That's why GE continues to have a co-op contract with the company on a variety of current business bids. As the president tours, touting alternative energy sources, wind is right up near the top. In just the US alone, capital investment flows into alternatives for last year was more than half of all cash devoted to every kind of non-traditional power sources.
"We've held this stock for longer than we like, tying up our capital. But we've seen a recent surge in the press about the industry and its main companies, such as Vestas. Our call for a buyout shouldn't take much longer. European and US purveyors of power generation equipment are going over Vestas' numbers. We've waiting for a bid. The latest chatter is that one of the big oils is kicking the tires. And the price being debated is around 200 kroner or more, which equates to about 32 dollars."
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