Power Move Ripples Aren’t Just for Water

Hey Influence Traders,

I hope that everyone caught Mark Sebastian’s TOP-3 post-pandemic stock picks (with a twist) presentation last night.

It’s a must see.

If you missed it, watch the replay here right now.

Energy Shortages Are Stoking Inflationary Fears

Recent headlines have not been positive for domestic energy.

The Colonial Pipeline hack has caused a major shortage of fuel. Colonial is working hard to restore operations, but the East Coast is losing about 1.2 million barrels a day of gasoline supply.

North Carolina has declared a state of emergency.

Inflation fears are already on the rise, with the year-over-year consumer price index (CPI) jumping 4.2% in April after rising 2.6% in March.

This jump is well beyond economists’ predictions and represents the largest increase in more than a decade.

According to the Department of Labor, this was the largest 12-month increase since September 2008, when the index rose by 4.9 percent.

Energy concerns are not helping to ease those fears.

Much of the April increase was driven by a 25.1% jump in year-over-year energy costs, with gasoline prices up 49.6% and energy commodities rising 47.9% over the 12-month period ending in April.

Ripples Are Causing Winds to Blow

The Biden Administration has made it clear that infrastructure spending will be used as a catalyst to transition America to a green economy.

Yesterday, Secretary of the Interior Deb Haaland and Secretary of Commerce Gina Raimondo announced the approval of the construction and operation of the Vineyard Wind project.

Vineyard, located 15 miles south of Martha’s Vineyard, is the first large-scale, offshore wind project in the United States. 

It will produce 800 megawatts, which is enough electricity to power over 400,000 Massachusetts homes and businesses.

The wind farm is expected to begin supplying power by late-2022.

Wind turbines will need to be installed and connected to the energy grid — and some leaders in the space that should benefit from this announcement.

Word on the Street is that the project will feature 84 General Electric (Ticker: GE) Haliade-X, 12-megawatt wind turbines.

The installation of the project will be a joint venture between Portland-based Avangrid Renewables and the investment firm Copenhagen Infrastructure Partners.

Wind Outlook

The news was met positively, with the International Energy Agency raising its forecast for the global growth of wind and solar by another 25% compared to six months ago.

The IEA anticipates that wind and solar are on track to match global gas capacity by 2022 — which, just take a moment to think about that.

A wind power increase will be a boon to the entire industry.

A Rising Tide Lifts All Turbines

President Biden said in a recent speech that, “There is simply no reason why the blades for wind turbines can’t be built in Pittsburgh instead of Beijing. No reason. None. No reason."

Well, Scottsdale, Ariz.-based, TPI Composites (TICKER: TPIC) manufactures and services composite wind blades for turbines. TPIC reported a 30.6% increase in operating income in Q4 2020 on a 10.3% year-over-year increase in sales. Yet its stock price is down with some analysts believing it is 25%+ undervalued.

I’m thinking of putting TPIC in the PowerMoves Portfolio. (Ironically, WindStax Energy started making wind turbines in Pittsburgh a decade ago, but it is privately owned.)

GE and Siemens A.G. (Ticker: SIE) are two of the world’s largest installers of wind turbines. SIE has installed over 100 gigawatts (Great Scott!) worldwide through more than 29,000 turbines and is now manufacturing blades in Iowa.

When green infrastructure money is dished out — and there will be plenty of it — the powers that be will have the production capacity onshore …

Wind turbines are spinning and companies are about to make #PowerMoves.

Cutting Through the Noise for You.

Frank

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