Zoltek (ZOLT) Reports Big Profit Surge, Shares On The Up & Up

Zoltek (ZOLT) has been one of the best green stock performers in recent months nearly doubling in price and it’s going to pop again tomorrow as the company reported a big surge in profit.  The company posted a profit of .28/share on revenues of $47 million vs the analyst estimates for .05 in EPS on revenues of $46 million.  That’s a huge improvement over the year ago quarter when the company posted a loss of .05 share on revenue of just $33 million.  The CEO said the wind turbine business represents its biggest growth potential and continues to improve.  He expects the large wind turbine segment to increase 15 – 25% per year for the next decade.  Back in February CEO Rumy declared that growth is coming and the stock surged for a few days.  However, it didn’t take long for the stock to take another big nosedive.  If indeed, the wind energy industry is entering a sustained growth phase shares look enticing at current levels.  This is great news for an industry that has really struggled.

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“We are pleased to report strong gains on both the top and bottom lines in the first quarter and continuation of the momentum we experienced in the fourth quarter of fiscal 2011,” said Zsolt Rumy, Zoltek’s Chairman and Chief Executive Officer.  “Our performance resulted from several internal and external factors. Our net revenues were up almost a third, despite the drag on our reported sales from the decline in the value of the Euro during the quarter, reflecting our expanded customer base in the wind energy business and increased sales of composite intermediate products. Our margins were positively impacted by a more profitable product mix, higher utilization of our production capacity, better operational performance, lower raw material costs and the decline in the values of the Hungarian Forint and Mexican Peso. We believe our first quarter results evidence that our carbon fiber business is on a path to increase significantly this year.”

Technically, the stock looks outstanding and you can’t say that for many green stocks these days.  ZOLT should move to the top of most green stock watchlists based on the technical improvement and the results last quarter.  The stock pushed above the 200 day moving average today with heavy volume and it’s up another 9% in after hours trading.  While extended in the short term, any pull backs represent a nice opportunity for an entry.

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