Why Capstone Turbine Corporation Stock's Jump Today Hints at a Massive Hidden Opportunity

Find out why the micro-turbine maker's latest order offers a lot more than what meets the eye.

Jan 6, 2014 at 4:06PM

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 micro-turbine maker Capstone Turbine (NASDAQ:CPST) took off this morning, gaining 4% after the company bagged two orders from Russia. Two noteworthy factors about the order are: It is the company's first order for 2014, and it caters to an important end market.

So what: Capstone will install its micro-turbines, totaling 24 megawatts in size, at modular power stations in Russia, taking it a step further into the high-potential oil and gas market in the nation. More importantly, some of those turbines will run on natural gas that otherwise would go to waste, and thus be flared (that is, burned). That's really interesting, and worth noting, considering that the emissions released from flaring of natural gas have recently caught the attention of environmental activists across the globe.

Now what: You may be surprised to know that Russia is the world's largest emitter of flare gas. According to the World Bank, the country loses more than $5 billion every year because of flaring-related economic and environmental implications. If an estimated 140 billion cubic meters of associated gas is burned globally every year, Russia alone flares nearly 40 billion cubic meters annually.

Needless to say, Russian oil companies are under tremendous pressure to reduce gas flaring, which in turn translates into a massive opportunity for Capstone Turbine. Capstone's micro turbines can effectively generate low-cost power while running on flare gas -- a combination that is generating greater interest not just from companies in Russia but also from the U.S. and Africa.

As stricter gas-flaring regulations make way in the years to come, Capstone's turbines should find more takers. The company is already expanding rapidly into the oil and gas sector, currently shipping more than half of its turbines to the market. Capstone's turbines are also multi-fuel, which further increases their scope of application.

Today's order may not be a big one, but it may well have the potential to change the game for Capstone Turbine for the reasons cited above. The green energy company already looks set for a big year, and this order may just be the beginning. Keep a close watch on this tiny stock.

How to make real profits from the oil and gas boom
Record oil and natural gas production is revolutionizing the United States' energy position. Finding the right plays while historic amounts of capital expenditures are flooding the industry will pad your investment nest egg. For this reason, the Motley Fool is offering a comprehensive look at three energy companies set to soar during this transformation in the energy industry. To find out which three companies are spreading their wings, check out the special free report, "3 Stocks for the American Energy Bonanza." Don't miss out on this timely opportunity; click here to access your report -- it's absolutely free. 


Fool contributor Neha Chamaria has no position in any stocks mentioned, and neither does The Motley Fool. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Money to your ears - A great FREE investing resource for you

The best way to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as “binge-worthy finance.”

Feb 1, 2016 at 5:03PM

Whether we're in the midst of earnings season or riding out the market's lulls, you want to know the best strategies for your money.

And you'll want to go beyond the hype of screaming TV personalities, fear-mongering ads, and "analysis" from people who might have your email address ... but no track record of success.

In short, you want a voice of reason you can count on.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich," rated The Motley Fool as the #1 place online to get smarter about investing.

And one of the easiest, most enjoyable, most valuable ways to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as "binge-worthy finance."

Whether you make it part of your daily commute or you save up and listen to a handful of episodes for your 50-mile bike rides or long soaks in a bubble bath (or both!), the podcasts make sense of your money.

And unlike so many who want to make the subjects of personal finance and investing complicated and scary, our podcasts are clear, insightful, and (yes, it's true) fun.

Our free suite of podcasts

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. The show is also heard weekly on dozens of radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable. Rule Breaker Investing and Answers are timeless, so it's worth going back to and listening from the very start; the other three are focused more on today's events, so listen to the most recent first.

All are available for free at www.fool.com/podcasts.

If you're looking for a friendly voice ... with great advice on how to make the most of your money ... from a business with a lengthy track record of success ... in clear, compelling language ... I encourage you to give a listen to our free podcasts.

Head to www.fool.com/podcasts, give them a spin, and you can subscribe there (at iTunes, Stitcher, or our other partners) if you want to receive them regularly.

It's money to your ears.


Compare Brokers