Westport Innovations ( WPRT) : Watch Only ! Don’t Invest

I am increasingly concerned about a business model that spends to enter markets like China and then returns to seek new capital because there simply are no profits in sight. Marking up parts is not what Westport or The Motley Fool promotes as the ” next big thing”.

Here is what I have been saying:

“This is a stock to watch not own. The company is one of several seeking to make money on natural gas transport but the goal is years away .See the article on the promotion of the stock to sell subscriptions to Motley Fool at http://www.amp2012.com

“Similarly – watch the potential natural gas conversion for trucking offered by Clean Energy and Westport Innovations. Westport has been ” touted ” by Motley Fool . Touted to gain paid followers – the bet has not paid off for the followers.”

HERE IS( are) THE  Argument(s) Today: my edited summary  from Bob the Investor comments

!)   Cummins They invest money and got part of the engine profits,part of putting on ng parts and a mark up on parts  SLOW To No Profits On Investment   Better to own Cummins who can buy through WPRT without a big investment in the WPRT systems or research.

2) In China(Weichai )
They got nothing on the engine . WPRT had to invest in part of plant that put ng on and got a mark up in parts and a partial profit of putting on parts
Because the Chinese business is so competitive little money was made or will be made
There are so many competitors that Westport systems which are costly – and the best may never be successful. That leaves Asia out.
3) Volvo they invested little and will just get a mark up in parts
4)  USA   Now they are going into cars
They will be the ones paying to have their system adapted
They will only get a parts mark up

In the USA they are now having to invest and in the future all deals will be just  supplying parts and parts mark up – not as much as they have been getting
Ng system pricing will come down in price as volumes increase
So they will be getting a smaller share of a smaller pie per vehicle and having to pay the ongoing research out of their own pocket
Gasoline engine and gasoline small vehicles will be getting much better gas millage so the need for ng will be less as millage improves or at least the gas engine will be more competitive for autos than it is for highway trucking.

The world or most of it does  not want the WPRT costly system
So WPRT  must quickly get its cost down and that’s what they are trying to do – Watch them but invest in better prospects.

Westport : Relying on Motley Fool PR and Cramer

English: CNBC’s “Mad Money with Jim Cramer” ca...
English: CNBC’s “Mad Money with Jim Cramer” came to Tulane University’s Freeman School of Business Oct. 19, 2010 to broadcast in front of a live audience as part of the show’s “Back to School Tour.” (Photo credit: Wikipedia)

As noted here there is a long term trend to natural gas as a real alternative to oil. However, Motley Fool ( in a run up to $40) and so many others have urged investors to climb aboard before the train is ready to leave the station. by that i mean that there is still little infrastructure to support natural gas vehicles on the road. the long term trend is in – profits are still years away .

  • Westport Innovations (WPRT +0.8%) enjoys a bump after Jim Cramer says WPRT iswell positioned as more trucks turn to natural gas.
  • CEO David Demmers tells Cramer that just 1% of all trucks in the U.S. are running on natural gas, but the trendline points to growth; many in the industry are racing to build the proper infrastructure to meet expected demand. (video)
  • Nat gas is cleaner and cheaper than diesel, and wide availability in the U.S. and China will make it a popular energy source for years to come, the CEO says.
  • WPRT also has a strong partnership with Ford, with its technology included in 11 vehicles and in the F-150 starting next year.


Above Average
As of 04 Sep 2013 at 11:36 AM EDT.


Open 27.26 P/E Ratio (TTM)
Last Bid/Size 27.52 / 1 EPS (TTM)
Last Ask/Size 27.60 / 3 Next Earnings
Previous Close 27.34 Beta
Volume 300,264 Last Dividend
Average Volume 386,347 Dividend Yield 0.00%
Day High 27.65 Ex-Dividend Date
Day Low 27.05 Shares Outstanding 56.5M
52 Week High 35.40 # of Floating Shares
52 Week Low 23.01 Short Interest as % of Float

NIKO Resources, Motley Fool and The AMP Hedge Fund

Mutual Funds for Dummies ... U.S. Funds at War...
Mutual Funds for Dummies … U.S. Funds at War — Too simple? (Monday, June 4, 2012) …item 3.. Music to Help Study and Work – 26:39 minutes … (Photo credit: marsmet545)

The AMP Hedge Fund tracks a good number of stocks for consideration – few as frustrating as NIKO . Great potential – but they used to say that about me.

My advice to myself is that it is better to be a little late into a position than to be early.

Thus we track NIKO ( NKO on Toronto) but haven’t taken a position. Years ago the stock was $ 114 and headed to $ 200 on the basis of massive potential . Natural gas discoveries in India , Indonesia and Trinidad. Swinging for the fences is not an investment strategy it is gambling.

Yet NIKO has the production in India – getting paid a below market rates to satisfy the election bets of the corrupt .

Track and watch and wait.

Similarly – watch the potential natural gas conversion for trucking offered by Clean Energy and Westport Innovations. Westport has been ” touted ” by Motley Fool . Touted to gain paid followers – the bet has not paid off for the followers.

Westport Innovations – Chuggin’ Along In Second Gear


Oct. 31

Tata/MDI CAT compressed air car
Tata/MDI CAT compressed air car (Photo credit: Wikipedia)

Westport Innovations  (WPT : TSX : $24.19

Management expects revenue growth for the year to be about 30%, down from its earlier expectations for 50% growth.

All in, revenue is expected to be between $340 million and $350 million, down from earlier guidance for revenue in the range $400- 425 million. Management cited a reduction in inventory by clients amidst economic worries and delays in the availability of liquefied natural gas infrastructure as reasons for the reduced guidance.

CEO David Demers said  ” We have a storong balance sheet and our asset-light business model allows us to remain competitively positioned. To help mitigate further contraction in overall transportation markets, we expect a number of key product launches in our automotive, trucking and off-road applications in 2013.”

Separately, the company also announced a deal with India’s largest auto company, Tata Motors to develop an engine for light- and medium-duty trucks and buses. Financial terms were not disclosed.


Westport Innovations – Update

English: Revenue stamp (2pi) for financing the...
English: Revenue stamp (2pi) for financing the construction of Hejaz Railway in the Ottoman Empire. Listed as No. 17a in W. McDonald’s Revenues of Ottoman Empire and Republic of Turkey. See also Ottoman Turkish Empire Revenue Stamps of the Hejaz Railway by Steve Jaques, Troy, 2009, pp.22 (Photo credit: Wikipedia)

Westport* (WPT : TSX : $39.13)
Westport* (WPRT : NASDAQ : US$39.04)

August 7

Shares of Westport Innovations jumped after the company reported their Q2/12 results. For the quarter, the
company reported consolidated revenues of $106.1 million compared with $44.9 million for the same period last year, an
increase of 136.3%.

Earnings were reported at a net loss of $6.1 million ($0.11 loss per share) compared with a net loss of $18.1
million ($0.38 loss per share) for the same period last year.

Breaking down its segments, WPT reported Westport Light-Duty (LD) revenue, which where up 182.2% to $30.7 million, Cummins Westport (CWI) revenue jumped 78.5% to $57.0 million with 1972 engines shipped, and Westport Heavy-Duty (HD) revenue was up 111.3% to $4.3 million with 75 systems shipped.

Service and other revenue was reported at $14.1 million.

CEO David Demers commented, “Key segments of the transport market have begun the inevitable shift from petroleum based fuel to engines powered by cleaner burning, low cost methane (natural gas), and Westport has a substantial presence in each market.” Demers also noted, “We are seeing strong growth in all segments and in all of our global markets, and despite challenging macroeconomic conditions, we expect this to accelerate as new infrastructure comes on stream over the next two years and as we launch new products, opening up significant new
addressable markets.”

Westport Innovations – Update

US truck - California 2007
US truck – California 2007 (Photo credit: Wikipedia)

June 6 2012

Westport* (WPRT : NASDAQ : US$27.02),


The AMP  WOULD NOT INVEST on the basis of the Cat deal – five years hence. Still the Motley Fool choice is a long term prospect for the nat gas vehicle play. Other opportunities exist for the here and now of the market recovery we predict.

Shares of Westport Innovations were up sharply after the company announced that it had signed a deal with Caterpillar (CAT) to co-develop natural gas technology for off-road equipment, including mining trucks and locomotives.

Caterpillar will fund the development program. When the products go to market, Westport expects to participate in the supply of key components. Development programs will start immediately for both new and existing engines, combustion technology and fuel systems. Commercial production is expected to begin in about five years. While the agreements initially focus on engines used in mining trucks and locomotives, the companies will also develop natural gas technology for Caterpillar’s off-road engines, which are used in a variety of electric power, industrial, machine, marine and petroleum applications worldwide.

Usage of LNG within trucking fleets, while still in its infancy, is growing. At current diesel prices, LNG provides a 22% fuel savings, which amounts of well over $20,000 per year for an average truck driver. Those types of savings have already seen several trucking companies make the switch to LNG or CNG. Vedder Transport, a milk hauler in B.C. already operates a fleet of 50 trucks all powered by LNG. There are some drawbacks to running an LNG rig, such as fuel evaporation and the special coolers needed at filling stations to keep the gas at -162 degrees Celsius. These limitations make it mostly suitable for long-haul trucks with large gas tanks. U.S. truckers spent more than $135 billion on fuel last year, according to American Trucking Association.

LNG trucks are also significantly more expensive than regular diesel rigs. Factoring in fuel savings and the extra initial purchase price, it is estimated that it would take between 3-5 years of usage to pay off the initial purchase price premium. An average highway truck engine has a 10 year life span. Truck makers are also gearing up for the coming wave of LNG rigs.

Paccar (PCAR, which manufactures trucks under the Peterbilt and Kenworth badge, expects the gas-powered-truck market share in North America to expand to about 20% in the next several years, up from about 6% now.





Westport Innovations – Volvo Update On A Motley Crew Stumble : Improving

Volvo Cars logo
Volvo Cars logo (Photo credit: Wikipedia)

Westport* (WPRT : NASDAQ : US$26.58)

 May 22, 2012

Westport Innovations was in high gear, posting double-digit gains on news the global leader in natural gas engines, Volvo Trucks, unveiled its plans to launch a 13-litre heavy-duty natural gas engine featuring Westport’s high pressure direct injection (HPDI) technology. The product is scheduled to launch for the North American market in 2014. Under the terms of the agreement, Westport will lead the program, but each partner will contribute significant resources and pay for its own people and costs of the program.

When the product is launched, Westport said it will supply its HD system components for an agreed upon amount per engine, comparable to other such arrangements previously announced. “The partnership with the Volvo Group is an important product development program and will help meet the increasing demand for natural gas engines and vehicles in the heavy-duty market.” said David Demers, CEO of Westport Innovations.

As the price of gasoline at the pump continues to creep upward, more and more investors are beginning to pay attention to Westport Innovations, as they appear to be the only pure-play game in town when it comes to a legitimate transportation fuel alternative. Earlier this month the company reported Q1 results which highlighted by significant volume strength from CWI (1,900+) and   (151) shipments which drove Q1 revenues, while LD awaits the ramp of the Ford Motors (F)  wing later in 2012.

Management also reiterated that it remains committed to aggressively launching new products/markets, like the aforementioned 12L, driving near-term operating expenses higher. However we are neutral on the stock as the rapid pace of new product line introductions and volume growth necessitates accelerated investment and 12L launch tempers near-term margins.