Why KiOR's Shares Popped

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of alternative fuel company KiOR (Nasdaq: KIOR  ) jumped as much as 14% in early trading, after announcing earnings and a plant opening. Shares settled into a much smaller gain as the day moved along.

So what: KiOR reported exactly $0 in revenue, and a $27 million, or $0.26 per share, loss in the third quarter. But, never mind that; the company announced that its first commercial scale plant is up and running.

Now what: This is a speculative play on energy, at best, and we have no idea when or if KiOR will generate a sustainable profit. The plant opening is an important milestone, but I wouldn't be a buyer until I see profits coming from the company, and sustainable feedstock prices. KiOR has a better shot than most to make it in this market, but it just isn't worth the risk.

Interested in more info on KiOR? Add it to your watchlist by clicking here.

 

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