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Windlab (ASX:WND)

Windlab (ASX:WND)  

  By: Claude on Nov. 6, 2018, 9:47 a.m.

Windlab has today announced that its equity partner for the Lakeland wind farm has pulled out of the deal, citing "risks associated with the project’s grid connection, including
risk of network losses and risk of curtailment".

Overall this is probably in part to do with lack of government support for renewable energy, as well as network planning issues, which may prove to be a persistant bother.

However, Windlab has plenty of experience working within this hostile environment for renewable energy, and things should get a bit easier if Labor win the upcoming election.

Nonetheless, this is bad news and the share price deserves to fall. If it does not, I may consider selling some shares (I am not in a rush, though).

Claude

Re: Windlab (ASX:WND)  

  By: Matt on Nov. 6, 2018, 10:11 a.m.

Yes, disappointing news. Windlab was always a risky stock as we stated in the initial write up. The renewables sector is rapidly evolving. I am still positive about Windlab's long-term prospects because I firmly believe in renewable energy and Windlab has an edge in prospecting for wind projects I am not considering selling any shares. It is a small position my portfolio because of the high chance of news like we have had today eventuating.

Re: Windlab (ASX:WND)  

  By: Claude on Nov. 6, 2018, 10:43 a.m.

Yea I'm not selling for now, either.

At $1.15 this will be very undervalued if, in the longer term, the environment for renewable improves, as I think it probably will.

Re: Windlab (ASX:WND)  

  By: trav-mays on Feb. 21, 2019, 9:30 p.m.

Hi Claude and Matt,

I'm keen to hear your recent thoughts on Windlab, whilst there has been no update on the delay for the Lakeland financial close, it's hard to not rethink your investment thesis, no matter how diligent it was, when you see it drop and hover around the $0.80 - $0.90 mark from the ~$1.35 at the time of your posting.

I'm still keen on them, I believe the long term outlook is very positive and they have a good track record of completing projects where there is grid connection risk. The state renewable energy targets alone will keep them busy, especially within queensland and as the likely winner of the next election increasingly appears to be Labour, the chances of a federal renewable target is looking more promising.

Their HY report released in 2 weeks is one I'm very keen to read

Anyway, just interested in your thoughts

Trav Mays

 

Re: Windlab (ASX:WND)  

  By: Matt on Feb. 25, 2019, 10:23 a.m.

Hi Trav,

I no longer hold Windlab despite what I said previously. This is mainly because I haver been increasing my cash balance as I think that valuations are high at the moment and have concerns over the macro environment. The reason that I included Windlab in the collection of names that I sold is that I am no longer sure that the company will become cash flow positive without a further capital raising (mainly due to the Lakeland delay). If there is a bear market then it will be difficult for companies like Windab to raise capital.

In hindsight, perhaps I should have waited for Windlab to become profitable before writing about and buying the stock in the first place. Ultimately, there is more risk there than I am comfortable with.

Matt

 

 

Re: Windlab (ASX:WND)  

  By: trav-mays on March 9, 2019, 12:12 a.m.

Hi Matt,

Thanks a lot for getting back to me

I think your analysis was quite unbiased and that whilst you may believe that you should have waited until they are/could be profitable before posting, I believe it was an excellent well rounded analysis of windlab at the time.

I can definitely understand your thoughts on the riskiness of Windlab, especially at this phase of the cycle, there appears to be a lot of money chasing a limited number of potential returns, pushing up prices. To quote Howard Marks, "Cycle positioning is to have more money positioned aggressively when the time is right and money positioned defensively when the timing is wrong" and rightly so, I believe this is what you are doing. If there was a recession (technical or otherwise) either Australian or global, cutting funding both state and federal (if something is put in place) is an easy cash grab.

Windlab is definitely risky and because of this I only have a small position. Having said that, as it is an investment in renewable energy, I am a little more OK with losing on this one, as it gives me more than just financial reward.

Thanks again and thanks to you both for the awesome podcast, Three wise monkeys, I really enjoy listening to it every week.

Trav Mays


 Last edited by: trav-mays on March 9, 2019, 8:31 a.m., edited 1 time in total.