Why KiOR Shares Popped
Apr 11th 2012 3:26PM
Updated Apr 11th 2012 3:28PM
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of biofuels company KiOR (NAS: KIOR) rose 12% today after analysts took a stand behind the company.
So what: There weren't any new ratings out today, but two analysts made comments that gave investors the conviction to buy. Piper Jaffray reiterated its overweight rating and its $20 price target after a field trip to the construction site of the Columbus facility. Cowen & Co. said completion of the plant at the end of the second quarter would be "a bigger trigger" for the stock.
Now what: Piper's price target is 66% higher than the current price, showing that at least one analyst thinks the upside is strong. The plant opening will be KiOR's first real opportunity to show it can perform operationally, which is what makes me worry about the stock. Until I see actual production and financial results KiOR will remain too risky for me, but I'll reconsider that after the company produces for a quarter or two.
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At the time this article was published Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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