Huge Opportunity in Chinese Wind Turbine Manufacturer

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In yesterday's issue of Small Cap Investor Daily, 'Renewable Energy Revitalization', I explored opportunities in companies that will build the smart grid infrastructure in the U.S.  You know that this grid will be critical to the success of renewable energy infrastructure, since it will allow energy to efficiently and effectively get from the point of generation to the end user. 

Today I'm going to tell you about the opportunity in small-cap companies that produce power – and specifically one Chinese wind turbine manufacturer that has seen its stock soar 182% already this year.   I know that there is a huge opportunity here for investors who want to establish a position in a company that is growing market share in this exciting industry.

In fact, I've recently put together a special report on three companies that will benefit from a renewed focus on alternative energy including wind, solar, and landfill methane.  You can read my Special Report: Alternative Energy Investing: 3 Top Stocks Set for Profits when you sign up for a no risk trial to SmallCapInvestor PRO. 

Renewable energy infrastructure is coming back into the spotlight 2010 for a few important reasons:

1) Job creation that the economy desperately needs

2) Reduction of pollution required to combat global warming

3) Need for independent, home grown sources of energy

All of these will require a range of energy producing solutions.   Tomorrow I'll write about job creation – today it's all about wind power.

If you believe, like I do, that boom times for clean energy are around the corner, you must be looking for the companies that are likely to benefit financially.  One of my favorites is A-Power Energy Generation Systems (Nasdaq: APWR), a Chinese wind turbine manufacturer that just announced plans to build a manufacturing facility here in the U.S. to supply turbines to North American projects.  This foreign investment on domestic soil is an indication that activity in the wind sector is heating up.  Not only will A-Power be creating new jobs here in the U.S., but the company also just announced that it will be supplying as many as 240 wind turbines for a new $1.5 billion wind farm to be built in Texas.  

A-Power is winning contracts and growing its business here in the U.S. Long term, I think this company will be a winner in the renewable energy industry. The company operates with a healthy 10% profit margin and delivered an 18% return on equity over the last twelve months.  What's more, the stock has increased 182% this year.

But even after rising so sharply, A-Power shares are trading on the cheap. The company currently has a P/E of only 15.6 and is trading at a discount to the Russell 2000, which has a P/E of 17.

A-Power's sales are taking flight, and so are earnings.  The company is expected to increase EPS by 53% next year on a 77% increase in revenue. And based on 2010 EPS estimates, shares are trading at a very reasonable P/E of only 10.

The renewable energy industry is going to grow in 2010, and small-cap stocks like A-Power Energy are rapidly increasing energy production and growing their sales. The best part is that Wall Street is still overlooking A-Power shares, giving astute investors like me and you an opportunity to get in on the ground floor.

Check out A-Power and let me know what you think. And if you want to know more about my bullish outlook on the alternative energy sector, and receive my top three stocks in the sector, than I encourage you to try my SmallCapInvestor PRO service without risk or obligation.