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No. of Recommendations: 5
(market cap $0.327B)

INTRO Here's my semi-annual exercise to see if I remember why I own the stocks I own. I post it in case it helps others too.

American Superconductor is a speculation that is becoming an investment, but just like its technology and industry, this will happen slowly. My easiest description of them is that they are to power what optical fiber was to the telephone. The analogy isn't completely accurate. I didn't think it up, but it helps illustrate where they are and what they are doing. They have more in the product line (e.g. power regulation, motors). That's why they could be a very good investment.

But. They are in an industry that changes slowly. Their system requires cryogenics which is far more complicated than the switch from copper to fiber. And as I recall, they can't go everywhere. They can't be used in overhead wires and such - though for many years I envisioned them doing so.

I consider tham a buy. They've cleared the research hurdles, are into development, selling some units, and are correctly focussing on improving manufacturing processes.

As for stock price, compared to this time last year, their risk is lower and they are closer to profits. Yet the price stagnates as if it is being analyzed as a mature company instead of a startup. This gives the stock a lot of potential as the products ramp up and generate revenue. No guarantees of course and that is why they are speculative. A windfall might give me the money to buy more but I will continue to hold.

DISCLAIMER LTBH since 2003 with a few shares added in 2006
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