Advanced Microgrid Solutions

Earlier this year the Midwest utility company Ameren Corporation (AEE:  NSYE) announced it advanced distributed energy microgrid located at the company’s technology center in Champaign, Illinois.  Those who follow the utility industry or those who are particularly interested in electricity transmission matters probably wonder what is so special about this news.  There have been a slew of microgrid pilot tests.  For example, Duke Energy (DUK:  NYSE) constructed a microgrid test bed in Mount Holly, North Carolina to demonstrate plug-and-play integration of its two dozen partner vendors.  Another example, is Southern California Edison’s (SCE:  NYSE) grid edge pilot in Orange County, California.  There are other microgrid pilots underway at Detroit Edison, CPS Energy and Oak Ridge Laboratory, to name just a few.

What is interesting for investors in the Ameren microgrid pilot?

Mining Energy

The Netherland’s Mijnwater BV (private) is trying to start a trend, which is a tough thing for a company with a name that is in no way considered glamorous or intriguing enough to emulate.  The company has forged ahead with its mission to turn abandoned mines into an energy source.  The caverns of a defunct coal mine near Mijnwater’s hometown of Heerlen was the company’s first attempt at perfecting its ‘demand-supply’ system for geothermal energy from abandoned mine shafts.

The underground tunnels and caverns of abandoned mines eventually fill with groundwater.  The earth’s natural forces end up heating the lower depths.  The deep the mine shafts the higher the temperature of the water.  The municipality of Heerlen spent quite a bit of time and capital studying the potential for tapping the energy in the water to alternatively heat its community’s buildings in the winter and cool them during summer months.  With five well sites, the city built the first mine water geothermal plant in the world to provide power to a municipality.

Stock Investors: Off to Work We Go

Heigh ho, Heigh ho

It’s off to work we go!

We keep on singing all day long

Heigh ho!

Got make your troubles go

Well, you keep on singing all day long

Heigh ho!

Seven Dwarfs Marching Song, Tom Waits

For some analysts the comparison of the S&P 500 Index with average wages for U.S. earners is a method of determining whether the U.S. equity market is overbought.  Dividing the S&P 500 Index price by the average hourly wage of all workers (salaried and hourly together) provides the number of hours the average person must work to buy a hypothetical stake in the U.S. stock market through the S&P 500 Index.  The measure might also shed some light on the economic dilemmas we face these days.  Call it the ‘equity purchasing power’ of the average wage earner.

Federal Reserve's Solar Band of Totality

People in the United States will be treated to a memorable event on August 21^st  -  a full eclipse of the sun.  In its daily route around the Earth, the Moon will travel in a path directly between Earth and the Sun, blotting out the usual yellow, bright solar view  -  at least for some people.  It is a momentous occasion given the rarity of such an event  -  once every 99 years.  It would happen more often if the Moon were in a perfect circular orbit or just a bit closer to the Earth.  As it is, the lunar orbital path is an elliptical shape.  What is more the Moon’s orbit of Earth is a bit tilted relative to the Earth’s orbit of the Sun.

Just as well the solar eclipse is not a regular occurance.  The unusual event provides us with an opportunity to pause for reflection or a handy excuse stage a good party.  Websites have popped up to help everyone from the most introspective to the carefree take in the fullest meaning or enjoyment.  Sites such as Great American Eclipse provide information on where and how to view the eclipse.  Fragile eyes can be damaged looking at the sun directly.  They recommend special glasses and ten locations in a narrow ‘Band of Totality’ across the United States extending from Oregon to South Carolina.  The rest of the country will not be left out but will only see a partial eclipse.  Funny glasses still needed.

Trump's Race-Baited Hook

In a post entitled “Understandable Terms” published on January 23, 2017, I wrote about my attempt to understand the 2016 presidential election results.  It was just a week after Donald Trump took the oath of office as president of the United States.  The first of several marches by concerned citizens had just been staged in Washington DC.  A half million citizens had just descended on the Capital to remind the new president that his campaign to ‘make America great again’ would not be allowed to roll over social and economic progress made over the last few decades.  Mostly women, they came wearing pink hats and carrying signs against racism, sexism and hate.  Over 400 marches of the same sort were simultaneously held in communities around the country.

It was baffling how Trump was able to gain the most powerful position in the country, perhaps even the world when so many people had so little confidence in him.  I wanted to understand how that could happen.  I needed to sort through the election in terms familiar to an investor. After all voters are essentially ‘investing’ their single vote in a single person who they think will do the most good for the country. 

In “Understandable Terms” I shared my 'financial' analysis of the 2016 presidential election.  Given the events of recent weeks as violence in the name of race escalates, it seems appropriate to reprise the article.  At the time I stopped short of making a clear connection between hate-filled racism and the 2016 election results.  Now it seems inescapable.  Trump won the 2016 through the tacit approval if not full-throated encouragement of racial animosity.  Now as he faces the disapproval of a majority of tolerant, peace-loving Americans he cannot reel back in his racism-bated hook.

Anxious over Energous

Shareholders were anxious to hear from the management of Energous Corporation (WATT:  Nasdaq) during the company’s regularly scheduled earnings conference call held this week.  Needed was an update on the much anticipated debut of the company’s WattUp wire-free charging technology in mobile devices.  Energous’ product plans have morphed over the years as one limitation after another was discovered both by Energous engineers as well as those employed by prospective customers.   

Indeed, the stock has traded off in recent weeks as a short-seller report made the rounds, alleging design failures of one sort or another.  The WattUp receivers rely on multiple antennas to collect micro energy beams created by a radio frequency (RF) transmitter. The key to success in the charging system is how Energous engineers have designed a ‘pocket-forming’ technology that directs the energy to the receiver by changing the shape and content of the RF waves.  The receiver chip set then converts the RF signal to a direct current (DC).

Tetra Tech's Two-Penny Disappointment

Tetra Tech’s (TTEK:  NASDAQ) quarter earnings report last week was met with high drama as traders reacted with surprisingly vehement disappointment over the recent financial performance of the engineering and technology business.   The company’s stock price gapped down in the first day of trading following the announcement, falling through a significant line of price support.   The shares continued to fall and finished the week at a price not seen since mid-April 2017 before the stock began its recent drive higher. 

Tetra Tech Coastal and Marine Resources Management 

The drama unfolded after Tetra Tech reported net earnings of $0.52 per share on $498 million in total sales in the quarter ending June 2017.  This compares to the consensus estimate of $0.54 EPS and $535.2 million in sales.  The two penny ‘miss’ was apparently seen as egregious despite the fact that reported results represented solid year-over-year growth rates in the high teens.

Redemption for Energy Recovery?

Despite reporting the highest gross profit margin in Energy Recovery’s history, investors were sorely disappointed with financial results in the Company’s second quarter ending June 2017.  On the first day of trading following the earnings release the share price gapped downward and closed even lower under above average trading volume.  This is likely because there was some expectation that Energy Recovery could finally report a net profit in the quarter as sales of the Company’s flagship PX Pressure Exchanger to the desalination market had appeared to pick up in recent months.  Unfortunately the Company reported a net loss of $500,000 or $0.01 per share on $12.2 million in total sales.

Good Business in the Environment

Florida Everglades

Humans are a filthy lot, and apparently unwilling to change their ways even in the face of irrefutable evidence that fouling your own nest can put survival in doubt.  That makes for good business for companies like Ecology & Environment, Inc. (EEI:  Nasdaq).  The company provides consulting services to industry on hazardous waste threats such as contamination by petroleum products used in manufacturing or chemicals required for weapons production.   Its portfolio of projects is filled with a variety of projects, ranging from ecosystem restoration in the Florida Everglades to zoning regulations for oil and gas development in Kern Country, California.

It is not a company that appears on lists of hot stocks compiled by analysts or reporters.  E&E keeps low profile as a problem solver for their clients.  However, with a foothold in a growing market and a small dividend as icing on the cake, the company merits consideration.