Clean Energy (CLNE)

[nypete]

Here is a comment on the article you mentioned.
What an enlightening 'battle royale' of contending views on Clean Energy we have witnessed.

I was privileged to hear evidence from knowledgeable people on both bull and bear sides of the case, as well as people with experience in the trucking industry.

My conclusion is that the argument has changed.

We are no longer in the chicken and egg scenario, where the product cannot be supported without the infrastructure, and the infrastructure cannot survive without the product.

The product, the Westport Cummins natural gas engine, whether fueled by LNG, or CNG, is in production. It's out there. Orders are flowing in. The rate of production is yet to be determined by the market, but the innovators have been testing the product in real time for a few years, and are ordering more.

If the product is to be successful, and given the macroeconomics of energy in the USA, it appears the opportunity is there, the adoption of the product, or its subsequent iterations, is likely to experience something similar to the Rogers Bell curve below.

http://bit.ly/LSh33z

A particularly important question for investors, at this point, is whether we are still in the phase of adoption by Innovators, or on the cusp of the Early Adopters.

And of course, timing and execution (and lucky guesses), are always utmost in the success and survival of an individual company. The continuing discussion of the merits of CNG vs LNG has brought to light the tremendous innovation going on in the infrastructure side. Improved fuel tanks and novel solutions to technological problems have and will contribute to the success of the natural gas engine.

As far as Clean Energy goes, they made an early, and expensive bet on LNG with their ANGH. Is it a “niche”, to be obscured by advances in the range of CNG vehicles, and relegated to “small niche”, as some contend ? It seems to me that they have savvy management, with substantial experience with both CNG and LNG. They do a large amount of business in both areas. They have a substantial amount of capital at their disposal, and in my opinion, the stock is cheap enough that I would not sell in a panic at this point.

If CNG wins the day, they will be a strong competitor. If LNG finds a strong base, they will be a big winner.

And finally on the “niche” argument, even a niche, in a large economic sector, can prove quite profitable.

The most exciting, and reassuring point of all the give and take, for me however, is my own conclusion that Westport Innovations, (WPRT), contrary to the gut wrenching price activity of the stock over the last two years, stands on the cusp of something very big. Certainly there are bumps in the road (pun intended) ahead. They seem to have a “moat” around their nascent business, with their 'IP', and their alliances with significant industry players. Without a doubt management must prove their worth over the next few years, and financing may prove critical, but if they get past 2014 without substantial dilution, or financial hemorrhage , investment at these levels may prove quite rewarding.

I am long both WPRT and CLNE.

Charlie

I still need to see what CLNE DOES AFTER THE CC.