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07/19/2011

Blogs for the Buyside: Altenergystocks.com


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Blogs for the BuysideHave you ever been confident in your assessment of the macro underpinnings of a sector but modest in your ability to provide insight into the potential of the specific companies in the sector?

That’s what I feel like with Alt-energy. For economic, environmental and political reasons it seems clear that the area will produce the next wave of billion dollar companies. But the science, legislation and competitive arena is perplexing.

So I went out to find a blog that could explain the science in business terms.

I found Altenergystocks.com.

The site is led by Tom Konrad. Konrad has the right balance of talents—he is a CFA, former board member of Axion Power and a mathematician. This gives him the ability to tear apart conventional wisdom (sorry electric cars!). He understands how the economics of a certain trend hurt one hyped technology while show promise for others.

The quality of the editorial is shown most clearly in the Portfolio columns in which the team develops paired portfolios of shorts and longs. This recent one on energy storage shows his ability to analyze the science, market psychology and microeconomics in one power-packed 700 word column.

My major criticism of Altenergy.com work is that it seems to rely too much on valuation techniques like price/sales. I would prefer a more practical valuation methodology. How about using cash-in-the-bank and relating that to a forecasted burn rate for an unprofitable company? If it is a profitable company use free cash flow and divide that by the estimated real capital it will have to raise.

But overall Altenergystocks.com gives the buyside a great resource to learn about the players in a field that will consume (and hopefully) produce capital in the years to come.

–Aram Fuchs, General Partner, Fertilemind Capital is captivated by the ability of blogs to change buyside research. He founded a website called http://www.capitalistcollective.com. He is hiring two analysts from the best stock pickers on the site and he is hosting a conference called The Capitalist Collective Stock Picking Festival, which is sponsored by the NYSSA and it will be hosted at our offices on September 9, 2011. 

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