Does Pay to Watch the Stock Market

An old favorite just hit another new 52-week high on the stock market. Patience and timing was key with this investment opportunity.

Back in 2005, I wrote considerably about the alternative energy investment theme, which became quite popular on Wall Street. The price of oil was going up big-time and all of a sudden, investors began to get very interested in anything that wasn’t powered by the black gold.

Solar energy stocks took off as both individual and institutional investors began to commit significant investment capital to this industry. And it wasn’t as if this industry just came to light all of a sudden. The solar industry has been around for years. But, the timing was right and investor sentiment was right for what investors were asking at the time, “How else can we make money with high oil prices?”

As part of the alternative energy investment theme, I brought to your attention a little company that sells pollution control products. Assuming that with economic growth came more and more industry pollution, the timing looked right for this market sector to take off. Throw in the China angle, and Fuel-Tech N.V. (NASDAQ/FTEK) quickly became a market darling this year.

As mentioned, this innovative company just hit a new 52-week high on the stock market. The company recently announced that it won another three orders for its “NOxOUT” product for coal-fired boilers at a large utility company in the Southeast. The value of the orders is about $4 million.

You know that a small company has made it big on the stock market when Goldman Sachs begins research coverage. One of Wall Street’s venerable investment firms recently initiated research coverage on Fuel-Tech with a “buy” rating. Now that Wall Street is at the party (albeit a little late) those subscribers who took on a position in this stock might consider taking some profits in the not-too-distant future.

The lesson with Fuel-Tech is that it really does pay to be watching the stock market all the time for great little companies. It also pays to get in on an investment theme just before the rest of the market jumps on the bandwagon.