Westport Innovations (NASDAQ:WPRT) — This global leader in the manufacturing of natural-gas engines uses innovative alternative-energy technology that allows diesel trucks to run on natural gas.
The company has suffered a string of losses, but those who believe (as I do) that a major change is about to occur in the use of natural gas vehicles should consider this stock.
On Nov. 15, Deutsche Bank initiated coverage of WPRT with a “buy” rating, saying “We believe risk-reward is attractive at current levels.”
Also in November, the company announced a unique on-board storage solution. The company said its newly developed LNG Tank System is expected to provide the ability to fuel even the largest spark-ignited engines on a single tank of LNG and reduce the overall fuel costs and weight “dramatically with a single-tank option.” In December, it was announced that Westport would provide natural-gas-powered versions of the Ford (NYSE:F) F-450 and F-550 Super Duty trucks in mid-2013, and truckers in Canada recently have begun installing the system.
And on March 8, it announced an agreement with Knapheide, the leading full-service commercial vehicle body maker to engineer custom bodies for Ford trucks.
Westport expects consolidated revenues to come in between $180 and $200 million, up 16% to 29% for 2013.
Technically, the stock reversed its long-term downtrend by breaking through its bearish resistance line at $28 and jumping to $32.89. Our “Buy Under” price is still $30, but the stock is completing a reversal, so potential buyers should jump aboard WPRT now. The near-term trading target is $38. Long-term buyers could see substantially higher returns.