Solar beats Ethanol
With oil near $100 a barrel, one of my calls from last year about oil is on its way to being realized. Back in July of last year, I predicted that oil would hit $125 in two years. In the short-term, I looked like an idiot as oil retracted back from $75 at the time to the $50’s. Now that its finally higher than when I made that call, speculation about ethanol and solar has somewhat settled. Solar seems to have beat out ethanol for the top dog in alternative energy (at least between these two).
Solar stocks have sky rocketed this year, while companies like Andersons Inc., (ANDE) and Imperial Sugar (IPSU) have underperformed. I’d like to reference a couple of my posts this year that might get your caught up on my position on these names. I last recommended Andersons Inc back in June of last year as part of my buy list, and before that in May , but the stock has really been a disappointment, giving up some gains since May 2006, but in the black since my call in June. Similarly, I recommended Imperial Sugar (IPSU) back in April of 2006 as a play on sugar, but the stock has gone down since while the broader market has advanced. On the other hand, my solar plays from back in April of this year, have done exceptionally well, in fact, all solar stocks have done well. We are also seeing practical applications of solar panels and while its too soon to predict the scope of adoption for these panels (whether we will see these on every apartment building in Manhattan), for now, solar has emerged the clear winner over ethanol. As such, I am no longer recommending IPSU and ANDE.
– Faisal Laljee
Full Disclosure: I do not own ANDE and IPSU, but my position can change anytime without notice.
Hey, great call on Solar.