Valence Technology: The Quiet Growth Leader

In the past six months, Valence's stock is up 160% compared to A123 and Ener1 that have moved up slightly.

Published: 31-Dec-2010

As the market starts to come around on commercial fleet electric vehicles, Valence Technology (Nasdaq: VLNC) is rewarding shareholders who looked past flashier stocks. Valence doesn't have a big flashy deal with Fisker, like A123 Systems (Nasdaq: AONE), or with Volvo, like Ener1 (Nasdaq: HEV), but it is riding the success of little-known Smith Electric's commercial vehicles.

Valence is out in front right now because it is focusing on commercial vehicles, while A123 Systems and Ener1 are building capacity for commercial vehicles, passenger cars, and electric grid projects. They're spread thinner, so the financial results will come more slowly as a range of products launch. That's not necessarily the wrong strategy, but results will take much longer to materialize and there are risks with a larger infrastructure.

If Smith is helping drive Valence higher, can A123 and Ener1 be far behind? Both have major commercial vehicle partners that should help results as commercial fleets electrify, and the market is just waiting to see some big results from these two battery makers.

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