Alternative energy company stocks are investments in alternative energy. Sources of Alternative energy are defined, and companies involved in these sources are discussed in this website. The major alternative energy sources include ethanol, LNG, solar energy, wind power, fuel cells, hybrid cars, geothermal energy, oil sands, shale formation oil, shale formation natural gas, and nuclear energy. Companies involved in energy efficiency improvements are also discussed.
Alternative energy company stocks should be considered for every stock portfolio, however, caution is advised. If you have a speculative personality, this is the area for you. Persons investing in the "pure" alternative energy areas, e.g., ethanol fuels, solar energy, etc., early-on made a killing in some stocks. But, if you jump into these investments now, you may be one of the investors hurt as the early birds unload their stocks. Rather than the pure alternative energy stocks, a better buy may be those blue chip company stocks that have only put part of their capital to work in alternative energy. It is recommended that the investor discuss this choice of investment with his Investment Advisor or Financial Advisor.
I am conservative in my financial dealings and I also have a different approach to defining alternative energy sources than some of the literature. I define alternative energy sources as substitutes for conventional fossil fuel oil and coal. The two conventional energy sources are non-renewable, that is, someday, when they are gone....they are gone forever.
To replace the above conventional oil and coal energy sources with alternative energy sources, e.g., solar energy, wind energy, geothermal energy, biodiesel, ethanol, etc, we will need "temporary" non-renewable, non-conventional energy sources to keep us going until renewable energy sources can be developed. Certain of these non-renewable, non-conventional energy sources - shale formation oil and natural gas and oil sands - are as necessary as are the more exotic renewable energy sources.
So, my definition of alternative energy sources used herein include the renewable energy sources discussed herein and, additionally, the interim (or bridge) energy sources.
This definition may be a little screwy but it keeps us from concentrating entirely on the pristine renewable energy sources that may take decades to get going. The conventional energy sources are being depleted fast and we can't shut down civilization while the renewable energy items are under development.
To me, LNG (liquefied natural gas) is an interim alternative energy source even though, it is really only natural gas in the frozen state. The same general logic holds true for shale formation oil and natural gas
I also define the diesel fuel products that can be produced from the abundant shale formation natural gas as alternative energy sources since such diesel products are alternatives to the present diesel fuels produced from crude oil which is in increasingly short supply. The new diesel is less polluting than conventional diesel. Much of the world is converting vehicle fuel use from gasoline to diesel (better gas mileage!) and the potential for such gas-to-liquid (GTL) diesels is excellent.
Oil produced from oil sands and tar sands is also considered an alternative energy form. Production of oil from these sources is rapidly increasing and the oil sands and tar sands are a valuable interim energy source.
Uranium is included as an alternative energy. I am convinced that, as oil and gas is depleted, we will have no choice but to turn to more use of nuclear energy for generating electricity.
To summarize, I use my own definition of alternative energy because, if we concentrate on pristine "alternative sources" such as solar energy, windmills, etc. to solve our energy crisis, we are going to soon be in a heap of trouble. We need to quickly develop what is actually available and workable and then worry about the long range, more exotic stuff.
So with my "definition" of alternative energy in mind, let us proceed.
I was shocked to see on TV a respected media spokesman discussing the use of the "little green pills" to improve gas mileage. You just put one or more of the expensive pills in your gas tank and your gas mileage is supposed to soar. What really shocked me was that no one was laughing at the time.
The above is probably one of the worst scams out there in the alternative energy area. The kit for converting used cooking oil from fast food restaurants into a fuel for your car is not really that much of a scam since the oil is combustible and can be made to burn in your car; but the idea may be impractical largely because of the odor of the cooking oil combustion. The odor will probably prevent this "alternative fuel" from getting too popular.
The present heavy use of ethanol is a mixed blessing although I am always suspicious when I see huge government subsidies and mandatory regulations necessary for a substitute fuel to compete with ordinary gasoline. The farm states that grow corn love ethanol. On the less cynical side of the coin, it must be noted that Brazil has apparently been successful in using ethanol to substitute for gasoline, so maybe it is a more viable fuel alternative than I think.
Another major problem with the ethanol producers is the price of corn from which most ethanol is produced in the U.S.. The price is close to $7 per bushel. Breakeven point for most ethanol producers is a corn price of about $5.00, so a significant additional rise in corn prices would certainly adversely affect the stocks of the ethanol producing companies...even with the government subsidies.
Put my cynicism about ethanol aside when considering this company. ADM is the largest producer of ethanol for fuel and they make a great effort to maintain quality, etc in the ethanol business. Also, ethanol is just one of many products produced by this world leader in agricultural chemical.
The market cap is $19 Billion. Revenue = $86 Billion. Net income = $2.2 Billion. Obviously, ADM is not that small of a company.
ADM stock was down slightly over the past year.
ADM is still king of the ethanol producers.
First Solar is an aggressive solar company which designs, manufactures, and sells solar electric power modules using a thin-film semiconductor process.
First Solar is fast growing company in the solar energy segment. The company is profitable.
First Solar has a market cap of $3.5 billion and revenues of $2.7 billion. Income was $530 million over the past year.
First Solar has many detractors who keep saying the company is getting ready to collapse. However, so far, the stock has held up but may be beginning to crack a little as the stock price lost about one-third its value during the past year.
First Solar is worth keeping an eye on!
In my opinion, LNG companies have a bright future as an alternative energy source. I just don't know which of the LNG firms will win out. Some of the active LNG firms are:
Cheniere Energy Inc (LNG).
This small independent firm also is engaged in oil and gas exploration in the Gulf Coast area. The exciting thing about the firm was its heavy involvement in the development of a liquefied natural gas (LNG) receiving business along the Gulf Coast. I don't have information as to how the present oversupply of natural gas in the U.S. will affect their LNG activies.
Market cap = $822 million and revenue is about $293 million. The company operated at a $227 million profit during the year. The stock almost doubled during the year.
Dominion Resources, Inc (D).
A fully integrated gas and electric company headquartered in Richmond, Virginia. Dominion generates and distributes electric power, but more important to this web site, it explores for oil and gas and delivers the oil and gas. Even more important to this web site, is that Dominion is heavily involved in LNG importing and actually operates one of the handful of LNG terminals presently operating in the U.S.
Dominion's revenues are $15 billion and net profit was $1.5 billion. Market cap = $28 billion. The stock was up about 20% during the year
Gas-to-Liquids (GTL). GTL processes utilize natural gas to produce a "diesel-type" liquid fuel that is relatively pollution free. Handling the GTL is much easier than handling LNG in that it is non-explosive and easier to transport (does not require cooling facilities or special terminals).
Both LNG and GTL have bright futures. Russia, Iran, and Qatar , the three countries with the largest natural gas reserves, also have bright futures in this area.
I was not familiar with Sasol before I prepared this web page so it was a shock to see such large, diversified, highly technical company operating out of South Africa. With advanced companies like Sasol working in the oil & gas industry, maybe we can hold off Peak Oil for awhile.
Sasol has well-developed GTL (Gas to Liquid) capabilities. In addition to producing liquid fuel from natural gas, Sasol also produces liquid fuel from coal. They also produce many other chemicals and are also involved in oil & gas exploration and production. They are involved in the large offshore Gabon fields.
Sasol's annual revenue is about $17 Billion and net profit is about $2.3 billion. Market cap is about $26 billion.
Sasol is highly rated by the analysts and may be a good investment for the long run. The stock down slightly over the past year so it may now be a bargain.
An alternative energy company to keep an eye on!
Clean Energy Fuels Corp (CLNE).
This California-based company has been called a pure play on the use of natural gas (compressed and LNG) to drive vehicles. As far as profitability goes, this new company is still dripping red ink but revenues are increasing. Boone Pickens is the largest investor in the company - a good sign sign since no one knows the oil/gas business like Pickens.
Clean Energy Fuels has numerous natural gas fueling stations operating at this time and these stations service thousands of vehicles, e.g., public transit vehicles, etc.
Vehicles operating on compressed natural gas are more popular in the western states but their use will spread.
Clean Energy Fuels has a market cap of $851 million and revenues of $171 million. As inferred above, the company is operating at a loss but is forecast to become profitable in a year or so. The stock value dropped almost 20% over the past year.
An interesting alternative energy play! It appears that compressed natural gas and LNG have more of a future in fueling vehicles than many of us anticipated. And you get Boone Pickens as a bonus!
Toyota Motor Corporation (TM).
It is unusual to classify a firm as large as Toyota as an alternative energy company. However, Toyota's Prius brand of automobiles has dominated the hybrid car segment. Early on, Toyota jumped out front and cleverly established Prius as the hybrid car. Other firm's hybrid models - often as good or better than the Prius - have taken a back seat. Notably, the hybrids of the U.S. big three auto companies have been in that back seat. As of now, Toyota seems poised to continue to lead the pack.
Toyota has a market cap of $97 billion, revenues of $223 billion and profit of $2.6 billion. Over the past year, Toyota stock was down one-fourth.
Toyota concentrates its business on passenger cars and other vehicles including pick-ups. It has world-wide production and marketing facilities.
General Electric (GE).
For those of you who are not interested in investing in the smaller companies listed above, GE may be of interest to you. GE is jumping into alternative energy in a big way. (Of course, GE is involved in many sectors in a big way!)
Some of the environmentally-friendly products that GE is involved in include LEDs, CFLs, efficient gas turbines, wind turbines, biogas engines, solar energy, etc., etc. Yes, GE is jumping into alternative energy in a big way and they have the proven technology to be the leader in the alternative energy field.
GE, with a market cap of $155 billion, annual revenue of $151 billion and net income of $13 billion, is the bluest of blue chip stocks! The stock was down slightly over the past year!
At one time, GE was spoken of as the company that could do no wrong. Will they recover their old status.
Johnson Controls Inc. (JCI).
Another blue chip. Johnson Controls is mentioned prominently in the alternative energy literature due to the company segment dedicated to "efficient buildings." The providing of energy-efficient buildings and homes is regarded as many alternative energy experts as the number one way to fight the energy crisis (Peak Oil). But Johnson is also in the battery business - lead acid batteries for vehicles and lithium-ion batteries for plug-in hybrids (joint venture with the French company, Saft). Johnson, of course is well known for its instrument products and systems for vehicles.
Johnson has a market cap of $19 billion, annual revenues of $41 billion and net income is $1.6 billion. Johnson stock was down about 20% in the past year.
General Cable Corp (BGC).
Still another smaller blue chip.
To get down to brass tacks about the company. It makes transmission cables of all types and sizes and transmission cables are going to be a huge business as alternative energy sources start coming on line and as efficiency requirements tighten along the electrical grids.
The market cap is $1.2 billion, revenue is $ 5.9 billion, and net income is $114 million.
1. Alternative Energy Sources. LNG, oil sands, solar energy, wind energy, hybrid cars, etc. are all discussed. We need good alternative energy sources!
2. Alternative Energy Sources - Solar - Ethanol - Biodiesel - Wind. Focuses on the renewable alternative energy sources - solar energy, ethanol, biodiesel, wind energy.
3. Oil & Energy Crisis. Peak Oil is just around the corner and an energy crisis is already developing. What will happen when Peak Oil actually arrives?
4. Oil & Energy Company Stocks. With an energy crisis developing, oil and other energy company stocks - both alternative energy company stocks and conventional oil company stocks - should be good buys.
5. Bakken Oil Companies The Bakken Shale Formation is one of the biggest oil plays in the world. It will give us a little time to develop Alternative Energy
Alternative energy stocks can be good investments as the present energy crisis develops. The alternative energy companies include those companies involved in oil sands, solar energy, LNG, GTL, wind power, geothermal energy, ethanol, biodiesel, and hybrid cars as well as those energy companies involved in energy efficiency systems and devices. The era of alternative energy has begun!
Last Updated: 05/20/13
This w1eb site, titled Alternative Energy Company Stocks and the information included herein, is intended to provide information only and should not be construed as investment advice. The information provided is meant to broaden your knowledge and enable you to make better investment decisions within your portfolio.
I am not registered as an Investment Advisor nor am I a certified financial advisor. Sometimes I give an opinion on the quality of an investment. This information is based solely on my own investment goals and investment needs and might not reflect your goals and needs and might not be an appropriate investment for your portfolio.
Please consult with your financial manager/consultant/accountant before actually purchasing any of the investments discussed herein.