Should You Buy Into the Rise of the Fuel Cell Makers?

This article was originally published by TheStreet and also appeared on Yahoo! Finance. 

By Sarfaraz A. Khan, research assistant:  Gohar Yousuf

March 17, 2014
NEW YORK (TheStreet) -- Fuel cell shares now are behaving like the 3-D-printing stocks of 2013. Shares of Ballard Power (BLDP_), like those of its peers FuelCell Energy (FCEL_) and Plug Power (PLUG_), have soared. In 2014, Ballard's shares have risen by 250% to $5.28.

Ballard Power manufactures and sells fuel cells and provides engineering services for fuel cell applications. A fuel cell is an environmentally friendly electrochemical device that uses hydrogen fuel and oxygen to produce electricity. So far, Ballard Power has designed and sold 150 MW of hydrogen fuel cells.

The recent sector rally can be attributed to increasing optimism due to some new orders, as well as Plug Power's deal with Wal-Mart (WMT_). More important, Ballard Power has made significant improvements in its top and bottom lines. The company's shares could continue going higher in anticipation of positive cash flows and break-even earnings in the near future.

Ballard Power's long-term outlook appears bright, as some of the leading automakers have been betting big on the future of fuel cell cars. Furthermore, Tesla (TSLA_) could also provide growth opportunities with its expansion plans.

Textura: 4 Reasons You Shouldn't Buy Into This Sell-off

This article was originally published by TheStreet

By Sarfaraz A. Khan
March 3, 2014 
NEW YORK (TheStreet) - Shares of Textura (TXTR_), which sells cloud-based invoicing and other services to the construction industry, have dropped 14% this year following a Citron Research report accusing the company of fraud and misconduct. 

Deerfield, Ill.-based Textura denied the allegations while several investment banks came to the company's aid with positive commentary. Nonetheless, Textura's stock still hasn't recovered. 

So, should you listen to the banks and use the sell-off as a buying opportunity, or avoid the name altogether? To answer these questions, we'll dig deeper.

For Textura, Citron has a price target of $4, which is considerably below its current share price of $25.67 after dropping 3.2%. The again, Wall Street analysts have a consensus 'outperform' rating on the stock, according to data provided by Thomson Reuters.

This 11% Yield MLP Is Still Not an Attractive Investment

This article was originally published by TheStreet

By Sarfaraz A. Khan February 22, 2014

NEW YORK (TheStreet) -- LRR Energy (LRE_) is a small-cap upstream limited partnership, formed by Lime Rock Management in late 2011. It acquires and develops oil and natural gas properties in North America. The business, which gives an attractive yield of more than 11%, has properties at the Permian Basin, the Mid-Continent region and the Gulf Coast, with more than 30 million barrels of proven reserves.

LRR's shares are trading at around $17, which is 32 times its trailing earnings and 4.7 times its trailing sales.

LRR has a lot of promise. The firm offers attractive dividends and has the potential for long term growth from the Permian Basin, particularly from Red Lake fields. The business has spent nearly all of its capital expenditure on its oil-weighted acreage and therefore will likely increase its oil output for 2014. Moreover, the business can also grow its reserve base due to more drop-downs from its predecessor, Lime Rock Resources.

On the other hand, LRR Energy has little to show in terms of execution. Investors would normally expect double digit growth from a newly established small-cap upstream MLP. But for LRR, so far, there has been no meaningful growth in terms of revenue, income or production. Its fuel sales have increased by just 2% from last year, while its adjusted earnings have dropped in the corresponding period.

For these reasons, and despite the above-average yield, I believe that investors should adopt a wait-and-see approach. LRR Energy could become an investment option when the business shows clear signs of improvement, particularly in terms of higher oil production.

Precision Drilling: A Bright Future Awaits For This Canadian Driller

Precision Drilling’s (NYSE:PDS) growth has stalled since 2012 but the company appears to be on the verge of a turnaround, which is evident in the improving drilling rig revenues per utilization day and active rig count. More importantly, the business is in a good position to capitalize on favorable secular trends coming from LNG development at the west coast.

Calgary based Precision Drilling (PDS) is Canada's leading oilfield services firm which provides contract drilling, well servicing and strategic support services to its customers. The company was formed as a private drilling contractor in the early 1950s and has grown on the back of fleet expansion and acquisitions, most notably, the $2 billion acquisition of Grey Wolf Inc in 2008. The business owns a large fleet of horizontally capable drilling rigs.

Earlier in December, the Alberta Investment Management (AIM) Company, which owned 56 million shares of Precision Drilling, sold its entire stake in the Canadian driller in an overnight transaction. This came after the company announced disappointing quarterly results in late November. As a result, Precision Drilling's shares dropped by more than 9% on December 5. This was largely due to the overreaction by the shareholders as the company's future outlook is still bright.

Business Segments

Precision Drilling has two business segments; contract drilling services and completion services.

Under contract drilling, Precision Drilling operates its rigs and provides onshore well drilling services to E&P firms, mainly in Canada and the United States. Until the end of 2012, Precision Drilling had 321 land drilling rings, including 186 rigs in Canada, 127 in the United States, 5 in Mexico and 3 in Saudi Arabia. In a recent presentation held earlier in December, Precision Drilling's management pointed out that their onshore drilling fleet has now grown to 334 drilling rigs, including 206 …. Read full article at Seeking Alpha

Active Power: This Struggling UPS And Infrastructure Solutions Provider Could Be Up For 60% Upside

Active Power (NASDAQ:ACPW) has failed to grow its core business but the business has taken a big step in the right direction for a full scale turnaround through a management overhaul. Its shares have been under pressure since 2012 but there are several catalysts at work that can push its shares higher. 

Active Power (ACPW) is a small-cap company that designs and develops backup power systems and provides continuous infrastructure solutions, through its uninterrupted power supply (UPS) and modular infrastructure solution (MIS) products, to data centers and other mission critical applications. The 21-year old company, which trades on the NASDAQ, is headquartered in Austin, Texas and serves the local, as well as British, German and Chinese markets. Last year, Active Power earned 40% of its revenues from international markets.

The company's top line growth significantly slowed down in 2012 and finally turned negative in 2013. Moreover, the management's confusion with its partner in China exacerbated the situation. As a result, the business's shares have dropped by 14% this year and are now trading just 0.93 times its trailing sales. The company has made some key changes and there are several catalysts at work that could translate into a significant upside for shareholders.

Products: UPS and MIS

Active Power introduced its patented flywheel-based UPS systems in 1999 and so far, by the end of September, it has sold more than 3,900 flywheels in UPS systems to customers located in 57 different countries around the world. The flywheel based UPS products, which are sold under the brand name CleanSource, provide higher power efficiencies, higher power densities, greater space savings and an environmental friendly energy storage solution as compared to other battery-based conventional UPS products manufactured by its competitors. These products come with load capabilities of up to ... read full article at Seeking Alpha. 

LightInTheBox: Growth Slowing, But Margins Improving

LightInTheBox’s growth has slowed significantly as the company, which relies heavily on one product category, is feeling the heat of the competition. Although business has shown improvements in profitability but it could struggle with margins in the future. 

China is the manufacturing hub of the world but there aren't a large number of Chinese companies that can be considered a global retailer of Chinese products. However, a small Chinese e-commerce company listed at the NYSE with a market cap of $367 million is trying to do just that. LightInTheBox (LITB) is a six-and-a-half year old online retailer from China, which delivers products to consumers around the world. The company operates primarily through 2 websites; www.lightinthebox.com and www.miniinthebox.com, which offer a wide variety of lifestyle products at attractive prices. Its websites can be viewed in 27 different languages and are available to more than 80% of the global internet population. 

LightInTheBox has become the biggest China-based online retailer, which sells third party products, in terms of revenues generated from outside of China.

LightInTheBox came to NYSE in June and was the first Chinese IPO of 2013 after YY's (YY) offering in November. Recently, Chinese companies have shied away from the U.S. markets due to allegations by short-seller firms, such as Muddy Waters.

The company's shares rose 16% in June and continued to rise until mid-August. Then in late August, LightInTheBox was hit with several lawsuits from its investors (such as here, here and here) as its shares plummeted by 40% following earnings, eliminating all gains made in the prior months. In the lawsuit, the investors claimed that LightInTheBox and its management led investors to believe that its growth prospects were at extraordinary levels when in reality, they were not.

Read full article at Seeking Alpha