# Anyone own Westport Innovations?



## daddybigbucks (Jan 30, 2011)

Ticker WPT

I want to buy big into this as i feel natural gas will be the next fuel because of the glut.
I wanted to buy last year at $20 but felt it was at a high. Well its at $40 now.

I recently bought a position with a stop sell at about 15% down.

The financials are just terrible as they don't make much money, but the stock keeps pushing on.

Just wondered if anyone has any insight...


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## PMREdmonton (Apr 6, 2009)

This is a speculative play on the new wave of vehicles that will be equipped with NG engines. WPT holds most of the patents on this technology so many of truck fleets are planning on conversion and this will lead to good earnings growth for the company over time.

The thing that has been really pushing the stock price recently is the potential gamechanging nature of the Natural Gas Bill in the US congress which would provide major subsidies to fund the conversion of trucks from diesel to natural gas.

The second thing that has really been pushing up the price has been the collapse in natural gas prices over the last few months from the warm winter and massive increases in supply from all the fracking going on.

The third thing that has been pushing up the price is all the agreements they have signed with manufacturers like Ford, Caterpillar, Cummins and UPS to use their technology on their vehicles so they can convert from diesel to natural gas using their technology and patents.

I do think the company will be successful but I don't know when they will grow into their valuation. They are consistently unprofitable by a wide margin. However, they had massive revenue growth on their last reported quarter going from $45M to $81M. Their previous best year for revenue was only $147M so if they can just continue with this revenue pace they will more than double their previous revenue record. Companies that can deliver that kind of revenue growth with evidence of persistent improvings in operating margins will eventually become profitable and will be assigned a high value.

I guess one other way of thinking about it is what is their technology worth? That is the main value in the company. Right now their market cap is $1.9B. Compare that to say Cummins with a market value of $23B. Should they be worth 1/12th of Cummins and their massive and consistent profitability? I don't know what their potential is and whether they can grow into that valuation based on how many engines per year could be produced at what kind of a fee paid to WPT. 

It is really not my kind of stock so I'd leave it to others to decide what they should be worth. I'd consider buying on a fallback to $32 or so as I think natural gas is the way of the future and they hold all the patents to convert petroleum engines to running on natural gas. North America is full of natural gas but economically feasible recovery of oil is in much more scarce supply so it is a massive growth area for the future.

If you want to play something less speculative in the future of transportation, consider Zip car. They are now profitable and revenues are expanding by about 50% per year with continual margin expansion from economies of scale and adoption of new technologies which are making their business more and more profitable over time.


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## daddybigbucks (Jan 30, 2011)

I can agree with most of your points there.

I think i found the reason why this stock trades without reason.
It trades on the Nasdaq.

It seems to keep with its upward trend so i dont mind buying high and selling higher.
I'm still holding back till the quarterly comes out(4 days), as im fairly certain it will drop when the financials show they are losing money. But also positive it will rise again after the financials are forgotten about.


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## I am the Walrus (Jul 9, 2018)

Interesting to read these old threads and check the stock price today $4.15


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