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Ken Sill From the Opalesque Team:
Alternative energy investment is almost impossible says Ken Sill, Director, TPH Asset Management.
According to comments made by Sill at the recent Opalesque Texas Roundtable, alternative energy options are too dependent on government subsidies and lack strength in their balance sheets, which raises questions about the level of opportunity in the sector.
"It is hard to see how those subsidies will be sustained in a period where everyone is looking for ways to cut spending. The stocks are not attractive and are almost impossible to short. Of, course companies that actually have an economic model that works without government subsidies are interesting, but in general, the space is uninvestable right now," said Sill.
Sill went on to note that it is hard to create alpha in the sector, which also makes it difficult to find the interest to foster investment.
Sill and others such as Jerry Swank of Dallas-based Swank Capital, argue that traditional energy commodity investments such as oil, provide significantly more opportunity for investors - especially oil in the US. Swank notes that shale technology is a key component to oil market growth. He points to the booming Bakken Shale in North Dakota as well as the Eagle Ford Shale in Texas as examples. Other areas such as the Permian Basin also have growth, spreading the resources throughout the mid-continent...................... To view our full article Click here
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