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weiwentg (98.29)

Fuel Tech - short squeeze

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October 01, 2007 – Comments (1)

Fuel Tech has been on the decline the last few days. I subscribe to M*'s Growthinvestor, which holds FTEK.

 M* analysts believe that some large institutional investors were spreading rumors that GE had a competing product out. They placed calls, and found out that this wasn't really true. GE has had a competing product out for some time, but it is markedly inferior. some people were also apparently quite dissatisfied with GE; one couldn't wait for the company's contract to end so they could get on FTEK.

Today, FTEK is up over 10%, which I think is probably a short squeeze. Take that, naked short sellers! long term investors shouldn't worry. FTEK's prospects are still excellent; GE could go and get its game together, but they are a huge company and it might not move the needle for them to go compete with FTEK. 

1 Comments – Post Your Own

#1) On October 17, 2007 at 1:55 PM, weiwentg (98.29) wrote:

I'm not really saying "I told you so" on Fuel Tech, despite today's near 10% rise, apparently on the news that the company secured a contract with a large Midwestern utility. Fuel Tech is going to gyrate wildly in either direction, but I think the general trend will be upwards. I think that even if the company fails completely in China, it will continue to make inroads in the US, and it will still be able to penetrate Europe's market. Morningstar's discounted cash flow projections (available to premium members) showed that if the company failed completely in China and ceased all international expansion (not likely), there's still a couple bucks upside per share.

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