Thursday, February 12, 2009

Robert Hsu sold his Best Buy

Some gain for Mr. Hsu on this trade, but much much confusion about what to do with HNP, that was at the same time one of the Best Buys and a Sell...

September 24th 2008

New Buy: Huaneng Power
In early 2007, I recommended Huaneng Power (NYSE:
HNP) as an investment in a growing company in a booming sector. We had a nice run with HNP, and sold it for an 11.6% profit 11 months later. Now, I think that the stock is an attractive buy again, as it is a top beneficiary of China's solid double-digit growth.

[...]

So to take advantage of this excellent opportunity, I recommend that you buy HNP under $30. I'm targeting $40 by the year-end, which would give us a nice 40% short-term gain.

Buy under $30


October 15th 2008

Huaneng Power (NYSE: HNP) announced that its Chinese power plants generated 12.73% more electricity from January to September, compared to the same period one year ago. It is great to see that HNP is optimizing its plants to meet the rising power demand.
In addition, the company will release its third-quarter earnings on Monday. Due to recent market pullbacks, HNP's stock is now very cheap and should be bought on pullbacks. Buy HNP under $25.


October 22nd

Huaneng Power (NYSE: HNP) also recently announced its results for the first nine months of 2008. HNP had consolidated operating revenues of 50.12 billion yuan, up 36.8% over the same period last year. And net loss attributable to equity holders of the company was 2.63 billion yuan.
Many analysts are expecting that by December, HNP may record a loss for 2008. This is due mainly to high fuel prices this year, as well as power tariffs that have yet to offset the rise of fuel costs. But I think the negatives have been already priced into the stock. Coal prices have declined recently, so this coupled with a potential electricity price hike will help Huaneng Power's profit profile. And I think as the inflation risk in China decreases, Huaneng will be able to raise prices. Buy HNP under $25.


October 29th

Huaneng Power (NYSE: HNP) has bought a 40% stake in Huanting Coal Group, and it is planning to acquire the Huaneng Ruijin Power Plant. These acquisitions should help the company in the long run as it consolidates power generation in the region.
In addition, the company said that it expects coal prices to remain high in 2009. And while high coal prices make it more expensive for power companies to operate, I still think HNP will be allowed to raise prices soon since inflationary concerns have abated. Buy HNP under $25.


November 5th

Huaneng Power (NYSE: HNP) said that it needs another huge power tariff hike of 0.27 yuan (4 cents) to offset soaring coal costs in 2009. A price hike will benefit the company, especially as global coal prices continue to drop. Buy HNP under $25.


November 19th

Huaneng Power (NYSE: HNP) is investing in a project to build two power-generating units and build a coal transshipping base in China. These projects are a sign of growth, and bode well for the company. Hold HNP.


November 26th

Huaneng Power (NYSE: HNP) will benefit from China's stimulus package as it is an important company in the country's prosperous eastern coast. Buy HNP under $25.


December 3rd

Huaneng Power (NYSE: HNP) shares have traded steadily higher in recent weeks, as coal prices dropped in China. As you know, the company has been struggling due to rising coal prices and the cap on electricity prices. But with inflation stabilizing in China, I expect the Chinese government to raise electricity prices. And the decline in coal prices could continue. So the two combines could benefit HNP's business nicely. Buy HNP under $25.


December 10th

On our Asia Edge buy list, China Unicom (NYSE: CHU), Huaneng Power (NYSE: HNP), and the iShares FTSE/Xinghua 25 Index (NYSE: FXI) all fit into this category. And they are the best places to be putting your money right now.

Huaneng Power (NYSE: HNP) announced this week that a 600-megawatt domestic coal-fired generating unit has been approved by the National Development and Reform Commission. The project will cost 2.52 billion yuan. This is good news for HNP and should be a profitable project for the company. Buy HNP under $25.


December 24th

Huaneng Power (NYSE: HNP) said that its power generating capacity reached 80.13 gigawatts, which is a 12% increase from this time last year. In addition, HNP said that total sales revenue increased 32.4% to 127.59 billion yuan for the first 10 months of the year. And business should remain robust as infrastructure spending in China picks up in 2009. Buy HNP under $25.


December 31st

Huaneng Power (NYSE: HNP) started building China's biggest solar power plant, which will be in operation in 2010. The project will cost 9.1 billion yuan ($1.3 billion). The company also said that it will expand its capacity for hydro, wind, solar and other clean fuels to 10,000 megawatts by 2010.
These projects are favorable to the company's expansion into "green energy," and is a sign of China's environmental progress. Buy HNP under $25.


January 7th 2009

Huaneng Power (NYSE: HNP) rejected a 10% price increase of coal that was sought by domestic suppliers. By rejecting the increase, HNP will be able to lower the company's cost structure and improve its profitability. Buy HNP on dips under $25.


January 21st

Huaneng Power (NYSE: HNP) shares will likely gain ground as the power generators and distributors will receive about 10 billion yuan ($1.5 billion) in support from the Chinese government. This is an effort to help power producers after they experienced losses under state-capped electricity tariffs and record coal costs. The government is reimbursing power companies for keeping utility rates low. The stock is up sharply today, so continue to buy HNP under $25.


February 4th

Huaneng Power (NYSE: HNP) shares have rallied 25% since January 20. There is technical resistance in the stock above $30, so I want you to take this opportunity to sell HNP when shares trade above $29.

Note that at the same time HNP was in the Top 3 buys of the week on Asia Edge website...








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