TPS Position Update – March 12, 2014

| March 12, 2014

March 12, 2014

. . . . Fuel Cell Energy (NASDAQ: FCEL) – Hold

Our portfolio has several positions hitting impressive new highs.  These include LTRX, KWK, CPST, and URG to name a few.  But, the most impressive of all has been FCEL.

As of this writing, the fuel cell producer is up 150% after being up as high as 262% this week.  The stock has been volatile with a lot of action lately, and the price swings have been large.

Basically, the entire fuel cell industry is getting a boost as fuel cell technology is experiencing more widespread adoption.  And, FCEL plans to have an operational factory by the end of the year.

Moreover, the company just received a $2.8 million award from the Department of Energy. The award money will allow the company to showcase the capabilities of its new power plant for industrial applications.

While FCEL may be volatile, the company has obvious upside potential.  Let’s go ahead and hold the position for now.

. . . . TransAtlantic Petroleum (AMEX: TAT) – Buy up to $9.60

We’ve been getting some questions on TAT lately, so here’s the deal.

The stock just went through a 1-for-10 reverse stock split.  As such, the share price multiplied by 10 while your share holdings have been divided by 10.

A reverse split like this is typically used by companies with shares trading under $1.00 so the stock can meet listing requirements for an exchange.  It really doesn’t mean much in the grand scheme of things.  And I don’t believe it’s a reason by itself to buy or sell the shares.

Technically, TAT is still a buy up to $9.60 and we’re still recommending it as a buy.  For those who don’t want to pay that kind of price for a stock, you can go ahead and skip this one.

. . . . American Apparel (AMEX: APP) – Sell

APP is one of the very few underperforming positions in our portfolio.  We had high hopes for this company, but it just hasn’t been able to turn the corner.

First off, the company’s bondholders have hired advisers for restructuring advice.  While the end result may be good for the company, in the short-run it’s not a good sign.

Moreover, the retail clothing industry has mostly been getting crushed this year.  Between a tough industry and a possible restructuring, APP is not in good shape.

As such, we’re going to sell out our shares here and save the remaining capital for better opportunities.

Please Note:

We don’t necessarily review every open position in each Position Update.  We focus on the positions experiencing significant news, notable price movement, or a change in recommendation.  Please refer to the Performance page on our website for our current buy, sell, or hold recommendation for any positions not mentioned in the Update.

Action To Take

  • Sell American Apparel (AMEX: APP)

Category: TPS Update

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