|INTRO Here's my semi-annual exercise to see if I remember why I own the stocks I own, and so I can check back and see if their stories have changed. I post in case it helps others too.|
AMSC (was called American Superconductor)
AMSC (market cap was $0.089B EOY2015 is $0.123B mid2016)
AMSC has two main divisions: grid enhancements and wind power services. The company began by developing superconducting cables that could do for power what fiber optics did for information, dramatically improve transmission. After several years they finally proved the technology and the manufacturing, which resulted in a line of products that includes cables, motors, and power regulators that are unique (or at least have little competition.) This is also partly why they were involved with Tres Amigas, a project that will connect three of the US power grids to enable better balancing, a particular issue with the renewable energy produced by solar and wind in remote places. Their wind division provides design services to wind turbine projects.
This would seem to be a good time to have a business in the power industry, particularly for improving its efficiency. They are now making nearly $100M in revenues, but continue to carry a loss. If they continue their trend in net income, they should be profitable within a year or two.
Despite that growth, the superconducting cables are not as positively disruptive as fiber optic cables were, yet. The wind turbine business is growing in India, which is good; but the stock continues to be discounted from the intellectual property battle happening in China. The stock has yet to recover from that drop in 2011 when the split adjusted price was effectively dropped from the 2009 high of ~$400 to the 2011 low of ~$36. Considering that it is regularly trading below $10, an optimist would say there was a lot of underappreciated value. Those highs, however, may have been exaggerated by a euphoria about the China market that was true until a customer turned into a competitor.
I continue to hold because if they reach profitability on ~ $120M, then a Price/Sales of 6 would suggest a market cap of $720M, which is a nice potential stock appreciation of about six-fold.
DISCLOSURE LTBH since 2003 but the first shares were sold years ago.
(I've also collected links to the other discussion boards and my other stocks over on my blog trimbathcreative.wordpress.com