The Investor Diary Entry #19: March 7, 2023
In my last entries I was looking into buying FuelCell Energy Stocks, but after reading its latest 10-K report, I became extremely hesitant. I thought I will leave it for a while and then come back to it after a while.
Following on the Hydrogen Fuel industry news, I found a couple of companies in Sweden and Norway, but I could not study them as I could not find their annual reports. I think I did not search well. I depend a lot on the software that I am using to the limit that if I don’t find the information that I need in the software, I don’t look else where.
Finally, I came across Westport Fuel Systems ( WPRT ), things are happening for this company, the news are great, but their latest 10-k didn’t come out yet. What made dive further into this company is its share price. I was able to look at it yesterday before the market opens. This means that Westport Fuel Systems closing stock price on Friday was at USD1.12.
Unfortunately this price didn’t last, and it shot up yesterday to become USD1.20. Westport Fuel Systems stock price today ( Before Market open is at USD1.21.
Forces Behind Investing in WPRT
WPRT stock news and reports are very encouraging. The company is very active and the surrounding analysis is very positive. Unlike the Analysis of the news and reports of FuelCell Energy which is all around whether the company is going to make it or not based on its low cash at hand, in addition to the legal issues that it faced with one major client in South Korea that accumulates a huge chunk of its revenues.
WPRT is expected to be profitable next year, while FuelCell Energy is not expected to be profitable in the coming three years. This is not a comparison, but I am putting them side by side just to show myself what made me enthusiastic about WPRT.
The most important aspect of my enthusiasm regarding Westport Fuel Systems stock is that my valuation of the company turned up that the current WPRT stock price is at a value price.
My Middle assumptions of the future of WPRT came up with a value price of USD1.26. WPRT stock price today is at USD1.21.
WPRT is keen of decarbonizing transportation. This closeness to the transportation sector is very appealing for me. Other companies are more concentrated on services industrial sectors. Although the concentration here is on heavy transportation and not small vehicles, but this is logical.
If it was going for the small vehicle transportation segment, I will be excited, but skeptical as well, since it is still too early for many reasons. Going for the heavy transportation is a step towards transportation in general in my point of view, in addition to being a realistic path.
Why I Didn’t Invest Yet in WPRT?
There are two main reasons for my reluctance in investing in Westport Fuel Systems; the first is that the first share price that I saw was at USD1.12. It went up more the 6% in one day. Although I don’t like market timing or buying into a price point, but still this is causing some reluctance.
The second reason, which in my point of view, is more important than the first is that its annual report didn’t come out yet. I would rather read this report before, investing.
This time I am not going to cost average. I feel like going all in with the dedicated amount. This strategy is one that I am thinking of applying to the whole small cap Hydrogen Industry. Still, I have not made up my mind yet, and I think I am going to decide on the buying strategy on case by case basis.
My Plan
What I am thinking of doing is wait for one signal or the other. Wait for the price to fall to USD1.12, if it did touch it, I will buy it, if not I will keep waiting until the annual report comes out.
Conclusion
On my current list of companies with priority to decide on, for sure WPRT is currently number one. I am also looking into two Scandinavian companies, and today I was excited about an English company but its price point made me a bit hesitant.
The latter three companies will give me two things; an expansion in the hydrogen industry, and stock in Europe which will diversify my portfolio geographically.
Currently I am heavily invested in the USA and considering the macro data along with the general over-valuation of the American companies, this is not very safe.
The Investor
Tuesday 7 March 2023
About The Author
I started to look into individual stocks in January 2022. I created this diary initially for myself to track my investing progress, and second as a place that I can share my ideas publicly hoping that others will share their ideas and learn from each other, and lastly as an online business where some links that I share are affiliate links, and if anybody bought anything by clicking those links I will get a commission based on that successful sale, which of course will not affect the price that you are buying the product or service at.
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