Good Monday morning, one and all. No, you're not crazy - you're receiving today's edition of the newsletter bright and early in the morning, even though we normally send it after the market closes. There's a very good reason for the early delivery today... there's a trading idea we want to get out to you ASAP, and the opportunity honestly may not wait for us until today's close. (The fact that we're breaking a long-standing end-of-day publishing routine should tell you just how urgent this thing is.)
If you've been in and around the market for than a few years, you've seen a number of investing themes come and go. They usually fall apart at about the same pace - and to the same degree - they developed.
The dot-com bubble of the late 90's was one of those rags-to-riches-back-to-rags stories. Gold was another bubble that inflated enormously in 2010 and 2011 only to completely unravel last year. Solar stocks were all the rage in 2007, but since 2009, you can barely give 'em away. None of these arenas look like they're ever going to relive their glory days either, because there's just not enough substance within them to get investors overwhelmingly interested again.
There's one major investment theme, however, that's not seen its buzz weaken over time despite being around for years. In fact, if anything, the buzz for this sociopolitical/economic trend is getting louder for one good reason - IT MAKES SENSE! Not only is it good for us as a global society, there's some real money to be made in it too.
That theme? Electric vehicles.
Yeah, battery operated (and I'll even include hybrids in the group) have been around for a while. The Toyota (TM) Prius should get the honors for being the first "green" mainstream, mass-commercialized vehicle after it was unveiled in the late 90's. The first truly marketable mainstream 100%-electric car, however, was the Tesla (TSLA) Roadster, launching in 2008. Even then, though, the ultra-cool Roadster couldn't be considered truly mainstream, as the price tag was an astonishing six figures and the company only sold about 2400 of them. Tesla followed that up with the more practical all-electric Model S, but it's still out of reach - price-wise - and not quite practical enough for most people.
The Nissan (NSANY) and Chevy Volt hit the market in between the Tesla Roadster and the Model S, but for a few reasons, both have been rather disappointing in terms of sales.
So why hasn't electric-vehicle-mania petered out like so many other investment fads have? Because most investors recognize it's not a fad - there's some real, long-term opportunity with EVs. It's just that the right company has yet to come along to meld affordability with practicality, and meld that practicality with some style. That is, the right company hasn't come along until now.
We think the corporation that finally has the winning EV formula is Green Automotive Company (GACR), and a doubling of the stock's current value isn't out of the question in the foreseeable future.
Simply put, Green Automotive Company (with a market cap of $52 million) is the combination of three operations, each of which is meeting an electric vehicle need in its own way. Those three divisions are Liberty Electric Cars, Newport Coachworks, and GoinGreen Ltd.
1. Liberty Electric Cars makes and services battery-operated vehicles. Its flagship product is a Range Rover converted to an all-electric vehicle called the E-Range. But, Liberty also services a wide variety of electric vehicles, filling a void that traditional auto garages can't. In fact, the company was recently named as an official service provider for the Ford Transit Connect electric van. Other EVs serviced by Liberty include the Modec truck... an EV that was launched four years ago and is used by the likes of FedEx, UPS and Veolia.
Liberty is also involved in building the technology to support the EU's Epsilon program, which is a continental-wide effort to develop an electric car efficient enough to boast a driving range of at least 150 km in a realistic, urban driving environment. This project is expected to build a completed prototype sometime this year, leading to full commercialization that would deeply involve Liberty Electric.
2. Newport Coachworks, first established as a traditional passenger bus manufacturer, is breaking new ground as a builder of battery-operated shuttle buses. The backlog of bus orders is approaching 500 units, which should keep the division busy for a couple of years. But, when the annual Limousine, Tour & Charter Operators Show in Las Vegas is held in February, orders could ramp up significantly. See, there's no other 100%-electric shuttle bus available anywhere in the United States despite a huge need for such a vehicle.
3. GoinGreen Ltd. is the consumer-oriented retailer within the company's framework. It's been marketing electric vehicles since 2003, but within the past few weeks the caliber of its product line has gone parabolic. The company unveiled the new Mia passenger car in November, and demand was huge from the onset, driven by the car's 74 mile range. Deliveries began in December. GoinGreen also added all-electric I'MOVING delivery trucks to its product base a few weeks ago, as the sole distributor in the UK. The I'MOVING trucks qualify for special grants, and interest in these trucks from the business world has been strong since they're more cost-effective than combustion-engine vehicles.
Now, while all of these individual efforts are compelling, what really makes GACR so investment-worthy here is two-fold: (1) This company brings every necessary aspect of the electric vehicle industry [like sales, service, and consumer as well as institutional markets] under one roof, and (2) this year is going to be an explosive one for Green Automotive Company, as sales of the Mia, I'MOVING trucks, and Newport Coachworks' shuttle buses (following February's limo show in Las Vegas) all hit their full stride within the next few months.
See, some of the most exciting things the company has to offer only fell into place within the past few weeks, and don't show up yet on the books. Indeed, most investors may not yet even realize what all GACR has going for it here in the midst of EV-mania; their lack of understanding is the core of your opportunity. With all of that being said...
It's easy to buy a stock when it's on the way up. In my experience though - especially when it comes to small stocks - it's not the ideal time to get into a position. The absolute best time to make an investment in a good small cap stock with a great product is when it looks like nobody else wants anything to do with it. Why? Because it's a situation that rarely lasts.
That's the situation with GACR right now; it's been beaten down pretty severely over the past few days, for no particular reason. Better still, the volume spike right at the most dramatic part of the pullback suggests we've already seen a capitulation.
I'm also not joking when I say to you how this window of opportunity could close rather quickly, without warning. The company's getting close to reporting fourth quarter's numbers, and following Q3's 1000% increase in revenue (with less product to sell), Q4 could end up giving us monster-sized growth. There's even more growth opportunity after that, however.
February's limo show in Las Vegas could be one of those catalysts, ramping up orders for the company's electric buses. The EU's Epsilon electric car project will have a final design in place later this year too, and though the Mia is now being sold and the I'MOVING trucks are close to hitting the market in Europe, those sales haven't yet been reported in a quarterly filing.
Point being, the fourth quarter - and all of 2014 - could be a huge year for GACR shareholders. It would take next to nothing for traders to realize this and start piling in, seeing the same bargain/story stock we're describing to you right now.
Bottom line? If you have any inclination at all that electric vehicles are on their way to becoming a mainstream mode of transportation and you would like to participate in their advent, then we feel Green Automotive Company is one of the best and most practical ways of doing so. Shares could double their current value of $0.13 without batting an eye, just from a technical bounce - there's no technical resistance until it gets back to the $0.26 area. And, once the market realizes everything the company has going for it right now, the stock may well blast past the $0.26 level. Just don't tarry, as we also think this dip from GACR is going to turn around quite soon, as dips from great stocks like this one typically do.