An improving overall environment for wind power in general, in the US, and company-specific financial improvements, could revive investor interest in Broadwind Energy (BWEN), over the next 12 months (BWEN current stock price: $1.49).
Note: BWEN is a very risky equity, given the company’s liquidity position. Please review the company’s most recent 10-Q for liquidity issues.
What does BWEN do?
BWEN operates in three business segments:
Towers: The Company manufactures towers for wind turbines, specifically the large and heavier wind towers that are designed for 2 megawatt (MW) and larger wind turbines. BWEN’s facilities have a combined annual tower production capacity of approximately 500 towers (1,200 MW of power).
Gearing: The Company manufactures precision gearing systems for wind turbines and custom-engineered gearing systems and gearboxes for energy, mining and other industrial customers.
Services: The Company offers technical and precision repair and engineering services to developers and operators of wind farms and manufacturers of wind turbines. During 2010, the Company approved an investment of approximately $7 million to develop a dedicated drivetrain service center in Abilene, Texas, focused on servicing the growing installed base of MW wind turbines as they come off warranty. The drivetrain service center was dedicated and put into operation in February 2011.
What Changed Here?
After two years of horrendous financial reports, BWEN’s recent financial results, under a new CEO, show signs of significant improvement and I believe some of their new services have excellent long-term potential. Additionally, after a significant downturn following the recession, the wind power industry in the US is showing signs of continued stabilization and growth. Despite signs of a recovery, BWEN’s stock price remains at depressed levels.
Disclosure: Affiliates of Envoy Global Research, and its principals, own shares in BWEN. All ideas, opinions, and/or forecasts, expressed or implied herein, are for informational purposes only and should not be construed as a recommendation to invest, trade, and/or speculate in the markets. Any investments, trades, and/or speculations made in light of the ideas, opinions, and/or forecasts, expressed or implied herein, are committed at your own risk, financial or otherwise.