Knobias ClipReport (7-5-2007)

Submitted from Knobias ClipReport

With the shortened trading day, many weren’t expecting much in the name of news or announcements. The market held its gains into the close, rising 40 points on expectedly low volume.

Apple continued to hold many traders attention due to news regarding the margins on iPhones. Some estimates have the 8GB phones creating margins of 55% on the $599 retail price and with 700K phones sold over this past weekend at a conservative $220 dollar profit per phone, Apple presumably made over $154M over the weekend.

With the start of the third quarter, many were looking for new positions after closing out some before the end of the last quarter. The solar sector, along with a few others, had some of the best performing names in the overall market.

One name related to the alternate energy sector that had a stellar second quarter on news that wouldn’t seem to move as much as it did was Beacon Power Corporation (BCON). The Company designs and develops advanced products and services to support stable, reliable and efficient electricity grid operation. Their sustainable energy storage technology has been approved for use in providing frequency regulation services in three of the largest open-bid electricity markets in the U.S.

Shares of the Company have gained almost 100% since late May, running from the 75c range to a high on Tuesday of $1.52.

In early May, BCON reported their first quarter numbers. Revenue was reported at $393,000 and a net loss of $3,090,000, or ($0.05) per share, compared to revenue of $289,000 and a net loss of $2,822,000, or ($0.05) per share, in the first quarter of 2006.

During the first quarter of 2007, Beacon Power incurred costs of $1,660,000 in research and development expense, compared to $1,061,000 in the first quarter of 2006. Research and development expense increased primarily due to increased expenses for development materials, increased headcount-related expenses resulting from hiring of engineering personnel and other expenses to support the continuation of their flywheel development and design of their initial frequency regulation facility.

In early June, the Company announced that the PJM Interconnection, a not-for-profit organization that manages the flow of electricity in the world's largest competitive wholesale electricity market, had approved BCON's flywheel technology for use as a frequency regulation resource in its region.

The flywheel technology benefits companies by allowing for increased market competitiveness, technology diversity, and the potential for reducing CO2 greenhouse gas emissions.

Noted Bill Capp, Beacon Power president and CEO, in the press release, “Beacon Power's flywheel technology has now been qualified by three of the country's five open-bid electricity markets: California, New York, and the PJM Interconnection, which collectively serve more than 100 million electricity users. These approvals give us multiple options for where to build our initial frequency regulation plant in 2008.”

With the efforts of government and activists to clean up and become more efficient in the energy sector, the name could become one to follow over the coming months as they execute their construction of the regulation plant. Investors would be wise to w

Visit 1800blogger to see all of our industry leading blogs