Small Cap Strategist is published by Crystal Equity Research an independent research resource on small capitalization stocks. Follow along as we discuss the most recent trends in the small-cap sector, investigate interesting companies and pan a few not-so-promising stocks.
Clean Energy Fuels (CLNE:Nasdaq) is building a nationwide
network of natural gas stations for fleet vehicles.The company supplies compressed
natural gas (CNG) fuel for light, medium, and heavy-duty vehicles; and
liquefied natural gas (LNG) fuel for medium and heavy-duty vehicles.While there is a growing number of fleet
owners that have invested in natural gas vehicles, Clean Energy has yet to reach
the critical mass needed to reach profitability. The company claimed 650 fleet owners as
customers with over 30,000 vehicles in operation.
Energy reported $334 million in total sales in the year 2012, compared to
$292.7 million the prior year.The
represents 14.1% year-over-year growth, which is not a bad showing given the
state of the U.S. economy.Unfortunately, the net loss widened in 2012.First of all, the profit margin slipped to
24% and higher general and administrative expenses served as an additional drag.
has really been a problem for Clean Energy Fuels is the slow pace of natural
gas vehicles by fleet owners.Engines burning
natural gas cost substantially more than gas or diesel engines.Even with the lower cost of natural gas, truck
owners claim the return on investment is too long.
Earlier this week Clean Energy and its partner Westport Innovations (WPRT:Nasdaq) announced a new program to encourage
natural gas vehicle purchases.The two
companies have agreed to bundle the Westport Liquified Natural Gas System and a
Clean Energy long-term fuel contract.The package of rebates and discounts should deliver the kind of savings that
will accelerate return on investment for truck owners.
the program is successful in winning converts to natural gas, Clean Energy will
open additional natural gas distribution points.Indicated demand of 30,000 gallons or more is
necessary to support regional fueling stations.Clean Energy has 60 new stations planned for the expansion that will be
added to the 348 natural gas fueling stations it had in operation at the end of
has been trading in a range the last few months, held back by a solid line of
resistance at the $14.50 price level.Fortunately, there appears to be a strong level of support near $12.00
per share.If the sales and marketing
program with Westport draws new customers at a faster pace, CLNE will certainly
look more attractive despite the recent losses.Recent trading sessions suggest that is an element of upward momentum in
the stock that could propel the price to the $18.50 level.Management’s report on the first quarter 2013
will certainly included at some news on special offer and that could be enough
to pierce the price ceiling near $14.50.
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of the Small
Cap Strategist web log, Crystal Equity
Research nor its affiliates have a beneficial interest in the companies