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Seek Energy Alternatives But Avoid Pure Solar and Wind Plays, Fund Manager Says.
Posted Sep 29, 2009 02:30pm EDT by Aaron Task in Investing, Commodities.

Related: UPL, SWN, XLF, BGC, PBG.TO, UNG, GEX
With the global economy heating up again (perhaps literally), the energy sector has dramatically outperformed off the March lows. Although crude prices have fallen sharply in recent days, alternative plays continue to attract attention.
But investors would be better off avoiding the pure wind and solar names and focus on "backdoor" beneficiaries of the push to a so-called smart grid, says Kent Croft, founder of Croft-Leominster, a Baltimore-based management firm with about $650 million in assets.

For example, General Cable is one of the largest holdings in the Croft Value fund, which is up more-than 30% this year and one of the top performers in its category in the 3- 5- and 10-year timeframes, according to Morningstar.

As one of the largest providers of transmission cable in the U.S., General Cable is poised to benefit from any improvements to the electric grid, be they from alternative or traditional power sources, Croft says. The firm is also exposed to growth in global utilities and attractively valued with a forward P/E of 12.5, he says.

Check the accompanying video where Croft explains his rationale for General Cable as well as natural gas names such as Ultra Petroleum and Southwestern Energy, as well as one smaller Canadian E&P company with a patented technology for extracting oil from tar sands at lower-than-average costs.

http://finance.yahoo.com/tech-ticker/article/346119/Seek-Energy-Alternatives-But-Avoid-Pure-Solar-and-Wind-Plays%2C-Fund-Manager-Says