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Good Evening Traders,
As you know, we’ve been on a crazy run of late, with our huge gain of 83% on Friday in WPCS being just the latest example.
Honestly, I can’t take much credit for the run. I’ve been applying a pretty simple system. And market conditions have been particularly potent and full and promise along the way. I also have a great team behind me.
As for the system, I look for sector trends in the broad market, and implied growth, strong catalysts, and solid technicals in the individual stock.
WPWR is a perfect example right now. Check out the report below for details.
Symbol: WPWR
Company: Well Power, Inc.
Quote: http://finance.yahoo.com/q?s=WPWR
Latest News: http://finance.yahoo.com/q/h?s=WPWR+Headlines
Company Website: http://www.wellpowerinc.com
New Trade Alert: Well Power, Inc. (OTCMKTS: WPWR)
The energy sector is pulling back sharply in the context of a massively strong trend. Check out the XLE chart. Now is the time to move in.
With WPWR, we have an angle on the sector, but with a lot more upside. That’s because WPWR is cheap – incredibly cheap, as it happens.
Well Power Inc. is the exclusive distributor of Wellhead Micro-Refinery Units (MRUs) for the state of Texas. Additionally, the company has first right of refusal on additional territories within the U.S. The operational business is a result of a licensing agreement with ME Resource Corp. (OTCPK:MEEXF) ("MEC"), and is valid for five years. The company agreed to a consideration of $400,000 for the licensing agreement with ME Resources.
Even if the company is not producing aggressively, the license agreement has unquestionable tangible value that we believe the stock has undercut during its recent decline.
This combination suggests that any excitement drummed up by the company about future partnerships to exploit the tangible value of its property and licensing assets should quickly shift momentum and sentiment giving us the sweetspot arb play.
And there are plenty of reasons to think WPWR business is on the verge of rising. Gas flaring offers a tremendous opportunity, for example.
The amount of flared gas continues to grow in the United States, doubling since 2000. This presents an excellent value proposition for WPWR. From a recent press release:
“As the Company continues to prove out the Micro-Refinery Unit ("MRU") and deploy its first test unit later this year, the growing problem of flared gas in such states as Texas, North Dakota, and Wyoming now account for more than half of the gas flared in the US resulting in losses in the billions of dollars.”
The stock is technically very well set up right now. Long term support is in play bigtime right now, and a breakout seems to be approaching by the day. With the energy sector pulling back inside a strong, long-term trend, now is time to move on this one.
I also have my suspicions that there may well be a lot of short interest camped out in this one. That could very easily spur what is known as a short squeeze. This can create some of the most dramatic upside you can come across in a market.
We think such a move may be very well set up right now in WPWR.
About WPWR
WPWR (Well Power, Inc.) has acquired an exclusive license from MEC, a Canadian publicly listed company that is developing mobile and scalable Wellhead Micro-Refinery Units (MRUs) deployable close to the wellhead to process raw natural gas into liquid fuels and clean power.
WPWR is now a development stage company seeking to commence the new business of distributing MRUs in the State of Texas and from there into other geographical areas.
WPWR is looking to position itself as a technology company, which will provide oil and gas producers and operators a solution to process otherwise wasted natural gas, including stranded, shut-in, flared and vented gas and produce valued end-products including Engineered FuelTM (diesel, diluents, synthetic crude) and electrical power.
WPWR was founded in 2007 and is based in Pandan Indah, Malaysia.
Top Investor Highlights
• WPWR is loaded up with short interest and sitting right at key support with numerous powerful catalysts in play.
• WPWR is primed for the ‘sector arbitrage deluxe’ right now given the strong trend in the energy sector.
• WPWR has pulled back to a strong technical level and then traded with a key reversal dynamic in play so far in July. It has now rallied as much as 75% off its pivot lows this month, with volume rising by the day. But the stock’s RSI remains in oversold territory at just 34.
WPWR: Flaring continues to be a problem - Well Power Inc. plans negotiations with MEC to acquire additional territories Update on Pilot Project Collaboration
HOUSTON, TX, May 7, 2014 /PRNewswire/ - Well Power, Inc. (WPWR),- (The Company), is looking at taking advantage of the growing concerns of flared gas in the United States by offering its licenced Micro-Refinery Unit ("MRU") as a solution.
As the amount of flared gas continues to grow in the United States, which has doubled since 2000, an excellent value proposition for Well Power exists. As the Company continues to prove out the Micro-Refinery Unit ("MRU") and deploy its first test unit later this year, the growing problem of flared gas in such states as Texas, North Dakota, and Wyoming, now account for more than half of the gas flared in the US resulting in losess in the billions of dollars.
This is evidenced by a Sierra Club.org article where it states, "In fact, in 2012 flaring amounted to a loss of $1 billion in fuel. Until clean energy replaces dirty fossil fuels, the industry should work to find best practices to curb flaring." In addition, the World Bank data shows that U.S. gas flaring has grown rapidly over the past five years, from 78 billion cubic feet in 2007 to 251 billion cubic feet in 2011, a 223 percent increase.
One may ask the question, why are these oil and gas companies flaring all this gas instead of capturing it or utilising it, the answer to this is pure economics. Companies find it more cost effective to burn off the gas than to implement and build infrastructure to get the gas to market. Many of these wells are in remote areas and building pipelines to tie into these wells is costly and not economical. In addition, flaring causes pollution, creates health concerns, and is economically wasteful.
In order to curb some of these concerns, states such as North Dakota are looking at implementing a tax –royalty to companies that are able to use green initiatives to be able to collect and reduce the amount of gas being flared. Dan Patience, President of the Company states, "if these leading oil and gas producing states are successful at implementing proposals to use flared gas to produce ammonia fertilizer, petrochemicals, compressed natural gas and for electric generation then Well Power is well positioned to offer a way to convert flared gas into energy and thus, will seek to expand its Licence with MEC Resources to include the states of Wyoming, Colorado, North Dakota, Oklahoma, and New Mexico."
In Summary, WPWR is a type-specimen sector arb squeeze setup with a technical bottom coming into place.
The stock has been destroyed on bearish propaganda and uncertainty, and now sits with extraordinary value relative to peers, and a strong likelihood of new partnership announcements that would create a ton of monetization opportunity for its tangible asset, which is a solid licensing agreement for much-sought after tech.
In this type of market, the only way to avoid regret is to be aggressive in stocks just like this one. Enjoy the ride!
Don’t forget to try my totally free SMS service for real-time alerts. Simply send the message VALUE to the number 555888. If you choose to stop, simply reply STOP.
There are no fees and no spam. Only real-time alerts on highly promising penny stocks hand-picked for maximum movement.
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Best regards,
Stephen Gray
Value Penny Stocks
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