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Alternative Energy Companies
A financial newsletter focusing on high quality stock picks

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Welcome to the Roen Financial Report, a comprehensive web service that focuses on alternative energy stocks. We offer free stock alerts, Mutual Fund and ETF updates, as well as vital articles for alternative energy investors. Subscribers get access to members-only web content, including up-to-date profiles on250 alternative energy investments. This includes our proprietary Fair Value Meter, which shows whether a stock is undervalued or overvalued in today’s market. Click here for a special discounted rate and free book offer for our subscribers. Start your subscription today!



 


Two Alternative Energy Companies Worth Watching

 

Harris Roen, Editor

August 14, 2013

The Roen Financial Report is constantly scouring the universe of publically traded stocks and funds to find investment opportunities in clean energy. In this effort, two companies engaged in alternative energy have been added to the Roen Financial Report tracking service. The first is a large western energy company with substantial wind and solar assets, and the second is a consumer electronics company moving into solar.


Sempra Energy is a large, diversified player in energy production. It is a holding company that owns five southern California utilities. Sempra also holds interest in energy assets in other parts of the United States, Mexico, and South America. It generates power from a diversity of energy sources, including natural gas, nuclear, wind and solar, and owns natural gas pipelines.

 

Of interest to the Roen Financial Report is Sempra’s significant and growing involvement in wind and solar. Sempra has an interest in two producing wind farms – Flat Ridge II in Kansas,Fowler Ridge II in Indiana. Together, these projects generate 670 megawatts. Sempra is also involved in the development of the largest wind farm in Pennsylvania, the 141 megawattMehoopany Wind project.

On the solar front, Sempra has three producing photovoltaic arrays. Two are at the Copper Mountain Solar Facility in Nevada, totaling 150 megawatts. The other is Mesquite Solarin Arizona, which also has a 150 megawatts capacity.

In addition to these projects, Sempra’s solar build out continues. It recently awarded a multimillion dollar contract to design and construct up to 250 megawatts of additional solar at Copper Mountain. Also, Sempra’s Rosamond Solar project, in the planning phase, is expected to produce up to 300 megawatts by 2015.

 

Financials

Sempra has posted solid financial numbers over the years. Sales have been steadily increasing since the financial crisis of 2008, and both profits and earnings per share are excellent. Sempra does have relatively high debt, however, particularly when looking at long-term debt compared to equity or sales. Its stock price has had a relatively steady climb since 2008 as well, having almost doubled since that time.

 

Investment Outlook

Sempra’s stock has shown excellent price momentum, but the price may have gotten ahead of itself. We consider the stock overvalued at these levels, Sempra looks like a better value in the $77/share price range.

 


LG Display Co Ltd. (ADR) (LPL)

 

LG is a large Korea-based consumer electronics company (you have no doubt seen their “Life’s Good” ads) that supplies products globally. LG manufactures thin-film transistor liquid crystal display panels, and organic light-emitting diodes. Though LG is known for producing a wide array of consumer items, it also makes industrial devices, automobile navigation systems, aircraft instrumentation, medical devices and other electronics.

LG is also in the solar module business. It appears to be capitalizing on the growing solar investment trend in Japan in the wake of the Fukushima Daiichi nuclear disaster. According to Bloomberg, the Japanese trading company Sojitz Corp plans to invest $362 million to build four solar plants with a combined capacity of 106 megawatts. Though unconfirmed, LG is reported to have been chosen to supply panels for the entire project.

 

Financials

LG has been a reasonable performer financially. Sales have climbed every year but one since 2006. Earnings and profits, though, have been more variable. On the positive side, it has low debt, which is typical for a technology company.

 

Investment Outlook

Because of its relatively high price/earnings ratio, and low earnings estimates going forward, LG looks to be trading above fair value. I would start getting interested in LG if it were trading in the $8-8.5/share range.

 


Summary

 

Sempra and LG are two high-quality companies worth watching as alternative energy investments. Pricing for both stocks, however, are considered high at current levels. Gaging these two companies, along with the +/-250 alternative energy stocksmutual funds and ETFs that the Roen Financial Report tracks, will help inform investors where best to invest their hard-earned dollars.


 

IMPORTANT INFORMATION

Individuals involved with the Roen Financial Report and Swiftwood Press LLC do not own or control shares of any companies mentioned in this article. It is also possible that individuals may own or control shares of one or more of the underlying securities contained in the Mutual Funds or Exchange Traded Funds mentioned in this article. Any advice and/or recommendations made in this article are of a general nature and are not to be considered specific investment advice. Individuals should seek advice from their investment professional before making any important financial decisions. See Terms of Use for more information.


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© Copyright 2012 Swiftwood Press LLC. All rights reserved; reprinting by permission only. The “ROEN FINANCIAL REPORT” is a subscriber-only website with access at $149 per year published by Swiftwood Press LLC, 82 Church Street, Suite 303, Burlington, VT 05401. For reprints please contact us at [email protected].

DISCLAIMER : Swiftwood Press LLC is a publishing firm located in the State of Vermont. Swiftwood Press LLC is not an Investment Advisory firm and does not give individual investment counsel or act as an investment advisor. Advice and/or recommendations presented in this newsletter are of a general nature and are not to be construed as individual investment advice. Considerations such as risk tolerance, asset allocation, investment time horizon, and other factors are critical to making informed investment decisions. It is therefore recommended that individuals seek advice from their personal investment advisor before investing. Any trading of mentioned mutual funds and/or companies by affiliates of the Roen Financial Report and Swiftwood Press LLC will be made in accordance with the published strategy and executed 48 hours after the newsletter is published and available to subscribers.

Any published hypothetical results may not reflect the impact that material economic and market factors might have had on an advisor’s decision making if the advisor were actually managing client assets. Hypothetical performance does not reflect advisory fees, brokerage or other commissions, and any other expenses that an investor would have paid.

Some of the information given in this publication has been produced by unaffiliated third parties and, while it is deemed reliable, Swiftwood Press LLC does not guarantee its timeliness, sequence, accuracy, adequacy, or completeness, and makes no warranties with respect to results obtained from its use. Data sources include, but are not limited to, Thomson Reuters, National Bureau of Economic Research, FRED®(Federal Reserve Economic Data), Morningstar, American Association of Individual Investors, MSN Money, sentimenTrader, and Yahoo Finance.

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