American Superconductor Corp (AMSC)

[Rawnoc]

Why I think AMSC is a SCAM and a VERY EASY short:

(1) AMSC had 12 years of losing huge sums of money in the Superconductor business, despite making promises of profitability at different times. 12 years of FAILure.

(2) AMSC is now supposedly into wind turbines as of last year. I think they will also FAIL at this.

(3) AMSC flew up huge on a recent PR touting a $450 million contract with a company in China that is supposed to produce 10 Gigawatts of power by the end of 2011. This is on top of their current $100+ million “backlog” to the same customer.

PR link here: http://biz.yahoo.com/bw/080610/20080610005242.html?.v=1

(4) "To explain how crazy this press release was, Citron refers to the largest wind power purchase order in the world, which was just publicly announced by T. Boone Pickens. Pickens, with General Electric, plans to build a farm for 4,000 megawatts (4 Gw) that is planned in 4 phases for ultimate completion in 2014. This project has been publicized all around the world in every language imaginable.
http://www.msnbc.msn.com/id/19231397/
http://www.cnn.com/2008/US/05/19/pickens.qa/
http://www.usatoday.com/tech/science/environment/2008-05-15-pickens-wind-turbines_N.htm

Now we are supposed to believe that American Superconductor just received an order for 10 Gw to be delivered by 2011. That is 2 ½ times the size of the Pickens project in a time span that is half the time. Yet, nowhere in any language do we see an order awarded to Sinovel that would support anything close to this..................AN ORDER OF THIS SIZE WOULD BE THE LARGEST ORDER FOR WINDPOWER IN THE HISTORY OF THE WORLD …. BUT WE CAN READ ABOUT IT ONLY IN ONE PLACE: AN AMSC PRESS RELEASE."

(5) "The Pickens project is supposed to cost up to $12 billion for all 4 Gw, therefore using the same math this Sinovel project would cost up to $30 billion in the next 3 years. Where is the financing for $30 billion in wind projects? Is it contingent on anything? What a great job Sinovel has done at keeping this secret."

(6) "...the company refers to their customer as Sinovel Wind. That is funny because the real name of the customer is Sinovel Windtec. http://www.sinovel.com/ "

(7) Sinovel's website says maximum capacity is 1,000 units yet this PR touts 9,000 units.

(8) Insiders have been dumping like mad into the rally the PR caused.