High Oil Prices Heat up Alternative Energy Stocks

In a world of slowing growth, it’s more and more difficult to find a growing industry in which to invest. It’s even difficult picking oil and gas stocks because the commodity price action is so volatile, and a lot of great expectations are already built into stock prices.

I continue to think that the alternative energy investment theme remains a pillar investment sector going forward and that the solar energy industry will continue to experience solid growth over the coming years.

One micro-cap company in this industry that looks very interesting is Amtech Systems, Inc. (NASDAQ/ASYS). This company manufactures specialized equipment that is used to automate the handling of silicon wafers and semiconductors used in the fabrication of solar cells and semiconductor devices.

Amtech, founded in 1981, was first known as Quartz Engineering & Materials, Inc. before it changed its name to Amtech Systems in 1987. The company is based in Tempe, Arizona.


According to Amtech, in its recent second quarter of fiscal 2008, total revenues grew to almost eighteen million, representing growth of 67% as compared to the comparable quarter last year and up 50% sequentially.

The company cited that it experienced stronger sales to the solar industry, which were somewhat offset by lower shipments to the semiconductor industry.

Net income for the second quarter of fiscal 2008 was $0.2 million, or $0.02 per diluted share, as compared to net income of $0.3 million, or $0.05 per diluted share, for the second quarter of fiscal 2007.

For the third fiscal quarter of 2008, Amtech now anticipates that its total sales will be between twenty-one million dollars and twenty-three million dollars, representing growth of approximately 63% to 79% over the comparable period last year. For all of fiscal year 2008, Amtech expects total sales to be in the range of seventy-one million dollars to seventy-five million dollars, representing growth of 54% to 63% over fiscal 2007.

The company just received a follow-on order worth some $8.5 million from an existing customer. Also note that the stock is still lightly traded.

It really is an exciting time in the alternative energy sector. The only good news with high oil prices is that they make us realize just how undeveloped energy technology really is. This trend is going to change over the coming decades and it’s going to be a great opportunity for investors.