As part of an initial deployment of US DOE grants for hybrid school buses, Enova Systems (ENA) and Navistar (NAV) will deploy an initial lot of 16 buses to various school districts.  The companies expect to win more work as additional tax credits and incentives become available for school districts who wish to deploy cleaner buses.  With Navistar (NAV) owning 60% of the US bus market, they may get a nice chunk of this business, but it’s such a large company it would likely be a drop in the bucket.  The real winner in terms of share price appreciation may be Enova which barely does $5 million a year in revenues and has never turned a profit.  I’m surprised the stock didn’t move today on the news. 

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Enova provides the hybrid drive system and has been working with Navistar for a few years.  “This is not the first time Enova has partnered with Navistar to break new ground in clean vehicle technology,” said Enova CEO and President Mike Staran. “In 2005, we collaborated on the industry’s first production plug-in hybrid vehicle, and we’ve refined the technology since. This order for 16 Enova-powered hybrid school buses solidifies both our companies’ positions as industry leaders.”

Technically, shares of ENA remain in a firm down trend and are trying to hold above a buck.  There is decent support around this level, but I’d be more interested if it can break out from the down trend which would mean a move above 1.40 or so.