The Tech Stock Investor

Halliburton announced today that the company headquarters, and the CEO David Lesar, will be moved to Dubai. The announcement was made at an energy conference in Bahrain on Sunday. Is this a bad idea for Halliburton? Or is it just an evolutionary move that larger companies have to make to compete in global markets with shifting economics?

Personally, I think it is a bad idea from a public relations point of view. The firm has been lambasted and investigated for problems related to operations it has conducted in Iraq while contracted by the US military. This just adds speculative fuel to the proverbial fire and does smack of a “cut and run” operation. Move the Headquarters, move the threat of legal operations against a company which can now be considered a foreign company by our standards.

From an economic point of view, this move is what global companies need to do to stay competitive. If you are a woodcutter, you do not move away from the forest, you move into the forest. Halliburton is doing lots of business in the Middle East which is a growing market for oil production. Will the move increase Halliburton’s bottom line or will it just mean more red tape for investigators to get through when the next scandal comes to light? Only time will tell.

Getting into the market in a technology stock has never been easier than it is today. With online discount brokers providing trades with commissions under $10 and tech stock research available practically for free, how can anyone go wrong? Well, getting into a stock is the easy part, it’s getting out that can be painful.

Some people look at investing like they have just purchased a lottery ticket. They get into a mind set that they “picked the stock” so it cannot possibly be a bad choice, therefor it must go up. They will collect a nice profit and do it again. If only life were so simply and everyone was “the chosen one” at stock picking.

Reality can be a cold mistress, especially when you have dropped 10 grand on a “sure fire bet” in the stock market. Lots of investors do this, watch the stock gain 10%, and stand speechless as it falls back 15%. Emotional investing only guarantees one thing: poverty. To be successful in the market you not only have to learn when to buy a stock but when to sell it as well. I was told long ago that I should know when I am going to sell the stock long before I purchase it.

When I pick up some shares of a stock, say at $38, I already know that if it tanks to $35 I am selling. I also know that if the stock shoots up to $42-$44 very quickly that I am selling it. In fact, in most cases I set a stop loss order when I buy the stock and I set a Good Till Canceled of 15% or so depending on the stock to lock in the profits if it sizzles quicker than I expect. Either way, I am safe. I lock in my profits or I cut my losses early and move on to another investment.

When all is said and done, have a plan when you buy your stock. Do NOT ever buy a stock without having a stop loss order in place, unless buy and hold is your strategy. Do your research, buy your stock, and wait for the profits. Just make sure your profits are always more than your losses. :)

Pacific Ethanol Inc. is engaged in the business of marketing ethanol in the western United States through its subsidiary, Kinergy Marketing, LLC (Kinergy). It provides transportation, storage and delivery of ethanol through third-party service providers.Pacific Ethanol sells ethanol primarily in California, Nevada, Arizona, Washington and Oregon, and has customer relationships throughout the western United States and supplier relationships throughout the western and Midwestern United States. It does not produce any ethanol that it sells.

Until it commences the production of ethanol, if at all, Pacific Ethanol’s operations would consist primarily of the marketing and sale of ethanol produced by third parties. During the year ended December 31, 2005, Kinergy purchased and resold an aggregate of approximately 67 million gallons of fuel grade ethanol to approximately 27 customers.

In October 2006, the Company acquired a 42% minority interest in Front Range Energy, LLC from Eagle Energy, LLC. Pacific Ethanol owns and operates an ethanol plant in Madera County, California, is constructing a second plant in Boardman, Oregon and owns a 42% interest in Front Range Energy, LLC which owns and operates an ethanol plant in Windsor, Colorado.

Pacific Ethanol’s goal is to become the leading marketer and producer of renewable fuels in the Western United States. In May 2006, Pacific Ethanol completed an equity funding of $138 million which provided the Company with sufficient cash to both accelerate its stated goal of completing five ethanol production facilities totaling 220 million gallons of capacity per year by the middle of 2008 and its plans to complete additional ethanol production facilities, increasing total capacity to 420 million gallons per year by the end of 2010.

Pacific Ethanol, through its wholly-owned subsidiary, Kinergy Marketing, LLC, is the largest West Coast-based marketer of ethanol. In addition, Pacific Ethanol is working to identify and develop other renewable fuel technologies such as cellulose-based ethanol production and bio-diesel.

Highlights
• Net sales for Q3 of 2006 up 131% over Q3 of 2005
• Net sales grew sequentially from Q2 of 2006 by over 31%
• Marketing operations accounted for substantially all sales; Q3 is last
such quarter as Madera plant and Front Range Energy LLC will
contribute to sales in Q4 of 2006
• Strong gross margin exceeding 12% for Q3 of 2006
• Company generates first quarterly profit of $0.07 per share
• Strong cash position
• Boardman, Oregon plant continues on schedule for completion by end
of Q2 of 2007