My initial guess is it will in the long term solar will continue to be a consistent source of alternative energy for America. Now to be honest this is such a difficult area to invest in because for me I don't have alot of information on how to separate the good solar companies from the bad. Today, I truly felt like I left a good opportunity on the table while I was doing my research yesterday. I am going to fault the great American gymnasts for slightly distracting me as I was reading a story that was HEADLINED on Yahoo's front page. It was describing a large deal for solar technology that is taking place in California. So I clicked on the following story:
TWO LARGE SOLAR PLANTS PLANNED FOR CALIFORNIA
After reading the story I followed in the footsteps of one of my investing mentors, Peter Lynch, and began researching some of the key companies mentioned (OptiSolar, PG&E, and Sunpower). My only problem was the Olympics didn't allow me to do a very detailed review of the article above. I read the article and decided that the PG&E was not going to be my main focus because they may benefit in the long term from a large exposure from solar technology they will be spending capital in the short term to get there. However, I was very interested in the companies providing the solar equipment to PG&E which would be OptiSolar and Sunpower. Now with a quick read of that article you its focus is mainly on OptiSolar and I decided to find the company website and determine if this was a public company or could provide an additional lead to an investment. Now what you didn't hear me mention was a review of Sunpower to determine if they were a public company. There lied my mistake because I overlooked the second company, which didn't have as much of a focus during the story, and missed a great opportunity to cash in on this news early.
So as I did some light research on this lovely Friday evening, I learned that Sunpower (the second company) was up 18% today on news that it looks to sign big deals like the one announced with PG&E. You win some and I guess you miss some.
On another note, I have found a solar ETF (KWT) that could provide you with exposure to this growing sector without having to pick just one.
Buffet Note:
I should probably pay just as much attention to his recent additions in his portfolio but the more suprising news is the addition of an energy company, NRG Energy. This company is currently down 18% since that addition and now that this has been disclosed this stock will benefit from the Buffett Effect. NRG is up 5%, even as most energy firms are declining today.
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