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JakilaTheHun (99.93)

Dramatic Surge for Raser / Possible Short Squeeze?

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February 04, 2009 – Comments (5) | RELATED TICKERS: RZ

Not sure if anyone was paying attention to it, but about 3 PM yesterday afternoon, Raser Tech's (RZ) stock experienced a dramatic surge from around $4 to $4.70.  This was after trading in the $3.10 - 3.40 range a few days earlier.  It is possible a short squeeze is occuring right now.  The other alternative might be a large buyer coming in.  I can not find any headlines on RZ that would indicate this spike was news-related.

IMO anyone shorting RZ right now is making a really bad bet. Despite their heavy debt load and low liquidity - their properties, intangible assets, and know-how are probably dramatically understated and don't really show up on the balance sheet. Going short, you might luck up and get a 40-100% return, but you risk a -1000%+ return to do so. Once they get their plants operating, the stock could move upwards in dramatic fashion.

Despite its one-star rating on TMF, large short interest, and huge amount of detractors, I think RZ is a good candidate for one of the biggest surprises of 2009. I did a write-up on it for Seeking Alpha a few months ago for anyone interested:

Raser Tech: The Ugly Duckling of Alternative Energy

If indeed a short squeeze is going on, there will probably be a short-term pullback so the daring daytraders out there might want to try a quick red thumb.  As for me, I'm on the long side.  I thumbed up on CAPS in the upper $4 range - I was a little early, but that's alright.  In real life, I went long at $3.25.  For those thinking of going long, you might watch it a few days and see it the price retraces a bit.  As I suggest in my article, this is not for low-risk types; RZ is a high-risk stock and I think it's a good piece in a well-diversified portfolio. 

5 Comments – Post Your Own

#1) On February 04, 2009 at 9:21 AM, kali77 (99.69) wrote:

Not saying for sure....... But this could have played a part in the recent spike.

 

Raser Technologies, Inc. (NYSE: RZ) announced today that it has entered into a long-term lease agreement with private land owners covering 37,000 acres of geothermal resources in Southeastern Oregon. The terms of the lease agreement were not specified, but include surface and other rights necessary to build geothermal power plants. The property includes a number of hot springs and wells that indicate the presence of significant geothermal resources. "Working with the University of Utah's Energy and Geoscience Institute, Raser has determined this area is one of the more significantly promising geothermal systems," stated Brent M. Cook, CEO of Raser. "We believe this is a vast resource area of mid temperature binary potential."

"Well logs of drilling in the area over the last few decades in combination with our work done during the past 13 months in this area reveals heat and flows of geothermal fluids indicating that this is potentially a significant resource for geothermal development," stated Richard Clayton, Raser's Executive Vice President. "The land is ideally located in southern Oregon so that the power generated from the resource can be sold into either the Oregon or California renewable energy markets."

About Raser Technologies

Raser (NYSE: RZ) is an environmentally-focused technology licensing and development company operating in two business segments. Raser's Power Systems segment is seeking to develop clean, renewable geothermal electric power plants and bottom-cycling operations, incorporating licensed heat transfer technology and Raser's Symetron(TM) technology developed internally by its Transportation and Industrial Technology segment. Raser's Transportation and Industrial Technology segment focuses on extended-range plug-in-hybrid vehicle solutions and using Raser's award-winning Symetron(TM) technology to improve the torque density and efficiency of the electric motors and drive systems used in electric and hybrid-electric vehicle powertrains and industrial applications. Further information on Raser may be found at: www.rasertech.com.

Cautionary Note Regarding Forward-Looking Statements

This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including, but not limited to, statements regarding: our beliefs about preliminary drilling results; our beliefs about the potential for geothermal power generation on our leased properties; our belief about our ability to exploit the available geothermal resources; our beliefs about the strength and enforceability of our agreements; our beliefs about our ability to successfully negotiate power purchase agreements; and our beliefs about the geothermal market generally. These forward-looking statements involve certain risks and uncertainties that could cause actual results to differ, including, without limitation, the competitive environment and our ability to compete in the industry; our ability to adapt our technology for geothermal applications; our ability to secure necessary permits; the strength of our intellectual property; our ability to attract, train and retain key personnel; and such other risks as identified in our quarterly report on Form 10-Q for the quarter ended September 30, 2008, as filed with the Securities and Exchange Commission, and all subsequent filings.

All forward-looking statements in this press release are based on information available to us as of the date hereof, and we undertake no obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this press release.

SOURCE: Raser Technologies, Inc.

Raser Technologies, Inc. Richard Putnam, Investor Relations, 801-765-1200 investorrelations@rasertech.com or Hayden Communications, Inc Cameron Donahue, 651-653-1854 cameron@haydenir.com or Public Relations contact: Stern & Co. Richard Stern, 212-888-0044 richstern@sternco.com or Alison Simard, 323-650-7117 arsimard@sternco.com

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#2) On February 04, 2009 at 9:32 AM, JakilaTheHun (99.93) wrote:

I spotted that press release, as well, Kali.  I think it probably played a part in the spike, but it doesn't fully explain it.  Particularly, if you look at the chart, the prices slowly increases and then shoots upward dramatically at around 3:00 PM EST or so.  Of course, it is possible that a large buyer came in upon seeing that. 

All the same, press releases like this are not that uncommon from RZ and I've never seen a serious spike like this before.  Raser is already selling power to the City of Anaheim, so they already have a CA presence.  This adds to that, most certainly, but it does not seem quite like world shaking news to me.  Raser has been slowly buying up properties on a frequent basis over the past year. 

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#3) On February 04, 2009 at 9:44 AM, kali77 (99.69) wrote:

After going back and looking at the chart, I would have to agree. There is something else going on, not sure what caused the spike though. I have not been following RZ but my interest is piqued.

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#4) On February 04, 2009 at 11:16 AM, TSIF (99.96) wrote:

Raser is my largest personal holding. I follow it daily.  I got in early on CAPS as welll and blogged on people dwelling on it's past reputation.  Yes, they are a startup that is overly long in the tooth in regard to their motors that play on the hybrid/electric car. They dropped to the low $3's because nothing came out about anyone partnering with them in the auto industry. Early in 2008 they began working toward geothermal which sent the current stock holders crazy that they were getting off track. Many people have a low opinion of management, but most startups never produce a product.  In this case the "perfect storm" of timing may make it possible that even Raser can't screw this one up. Currently their geothermal plant in Utah is several weeks behind meeting it's PPA agreement to Aneheim.  When Mickey Mouse gets his power then things should blossem.  Now that the auto folks have bailed, the geothermal players are coming in. There was a Newsweek article in this week's edition. The stimulus package should generate some very good shovel ready projects with Raser.  Salt Lake City also in the past few weeks brought in Raser to look at opportunities they may have. I agree, there is still risk here.  Raser will either pop with the stimulus package and power from Thermo 1 or will drop if they continue having engineering delays that put doubt into how viable the low-temperature model is working or the water supply.  At this point, I'm long and bullish and looking forward to a short squeeze.

Jan 11th blog: http://caps.fool.com/Blogs/ViewPost.aspx?bpid=128774&t=01000430564104330656

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#5) On February 04, 2009 at 1:37 PM, johnthayer (< 20) wrote:

check the newest issue of Business Week, dtd.2/9/09, pp 064for,"Raser, a play in geothermal juice".

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