There's a BOGO Sale on These Stocks

The world's top value investors love it when their best stock ideas are selling at bargain-basement prices. For those rarified investors, companies offering fire-sale prices become no-brainer buys. So regular investors like you and me would do well to emulate the masters and look at companies offering a "buy one-get one" sale on their stocks.

Less than a year ago these companies were trading for at least twice the value they currently do. While you'll naturally want to do more due diligence before buying, this might be an opportunity to pick up some quality companies at a severe discount. The market is within seven points of hitting a new 52-week high, so make sure there's nothing seriously wrong with these stocks before you plug them into your portfolio.

Hard as nails
When it comes to solar power, good news is a rarity these days. First Solar (Nasdaq: FSLR  ) was seemingly the exception that proves the rule, popping on a positive earnings report, though I agree with the assessment that when the financial gymnastics it employed to indicate a hike in its guidance is finally revealed for the cut that it was, the stock will tumble again.

While the market so far doesn't agree with me, there are plenty of other gloomy assessments out there from LDK Solar (NYSE: LDK  ) , SunPower, and Trina Solar that I have trouble getting excited about any name in the space.

That includes GT Advanced Technologies (Nasdaq: GTAT  ) , a maker of polysilicon equipment for solar shops and sapphire equipment for the LED industry. Its shares surged 14% late last week after analysts at Stifel Nicolaus reported it expected its backlog to grow in the coming quarters as the ability of sapphires to expand beyond just LEDs grew.

In a market dominated by Corning (NYSE: GLW  ) , GT believes its sapphires could become a more cost-effective alternative to other materials being used, such as scratch-resistant Gorilla Glass, for mobile device touchscreens. Corning has been enjoying double-digit growth in the segment, and its latest iteration is said to be comparable to sapphire in strength, but GT says it's working with major handset suppliers and expects the opportunity to really develop next year.

Currently the sapphire business accounts for 22% of revenues, and though it is growing sharply, polysilicon is still the bulwark of its operations and if industry weakness is any indication, it will serve as a drag on performance.

Certainly at just four times earnings estimates it looks cheap, and with it trading at half its expected growth rate there would seem to be significant upside potential. But each of its business segments faces strong headwinds and management says "end-user demand for the output of our equipment has either declined substantially or increased supply has surpassed demand."

As a result I'll be maintaining my underperform rating on Motley Fool CAPS, but let me know in the comments section below if you think GT Advanced Technologies is a diamond in the rough.

A fractured future
Despite natural gas inexorably grinding coal beneath its heel, the industry remains a paradox because the pervasiveness of the energy source has created massive amounts of oversupply. So even as its low cost causes greater usage and allows utilities to switch from "dirty coal" to "cleaner gas," the economics of the industry don't look appealing right now.

This past July was the hottest one on record and led to increases in natural gas consumption for power generation to meet air-conditioning demand, according to the Energy Information Administration. Natural gas consumption jumped 14.4% over last July. Yet natural gas prices dropped last week, inventories rose, and gas drilling rigs continued to fall.

That helps explain the results of nat gas water specialist Heckmann (NYSE: HEK  ) , which saw revenues and profits soar in the second quarter, but its share price plunge. It supplies the water natural gas companies use when they hydrofracture the underlying rock structure to get at the gas trapped underground. The problem was it continued to lose customers as those drilling rigs were taken offline, losing three-quarters of them in the Haynesville area alone over the past two years.

I've suggested that between the assault on fracking by environmentalists, costly new EPA regulations, and nat gas industry dynamics, it made it a tough stock to recommend for an investment. Yet I still rated it on CAPS to outperform the broad indexes because I see most of the bad news having been factored in. And of the nearly 500 members who've weighed in on the water specialist over on CAPS, 97% also expect it to outperform. The stock has inched up following its fall after earnings, but you can tell me below whether you think Heckmann's fractured and won't recover, or, as some analysts believe, it is poised to be acquired.

Have half a mind
While I'm still bearish on First Solar's prospects, many Fools still feel this renewable company still has room to run. For this reason, The Motley Fool has a new report out on the company, with a detailed look at the company's market position and potential. The report comes with updates when big news happens, so you can always stay up to date on the company. Click here for details.

Fool contributor Rich Duprey holds no position in any company mentioned. Click here to see his holdings and a short bio. The Motley Fool owns shares of Heckmann and Corning. Motley Fool newsletter services have recommended buying shares of Corning. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.


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