Tuesday, 26 March 2019

Solar Alliance Strikes Deal With Tesla

Our first Canadian pick of 2019 has performed quite well. In "First Canadian Pick of 2019 with 100% Upside and Chance to Restart a Profitable Gold Mine", we picked Scorpio Gold Corporation (SRCRF) (SGN.V). SGN has since risen from $0.025 to $0.07 in two months. We are going north of the border once again with Solar Alliance Energy Inc. (SAENF) (SOLR.V). While it has an OTC listing, over 15 million shares have traded in the morning and it's up over 100% to $0.07 in Canada on news of a deal with Tesla. We think that this stock can more than double from here in short order like SGN has. We are up to 841 followers despite not giving out a lot of alerts, a fact that we think is indicative of a successful, diligent and prudent stock picking history. If you like our picks you can follow our blog by clicking the follow button on the top of the left hand panel. You can also follow us on Twitter @StockTradePicks. We have over 3,700 followers on Twitter as well.

SOLR announced the following deal with Tesla:

"Solar Alliance Becomes Tesla Approved Vendor
Electric Vehicle Charging Solution is the Perfect Match for SunBox Home Solar System
VANCOUVER, BC, and KNOXVILLE, TN / ACCESSWIRE / March 26, 2019 / Solar Alliance Energy Inc. (‘Solar Alliance' or the ‘Company') (TSX-V: SOLR) is pleased to announce that the Company is now an approved Tesla vendor and has signed an agreement to install six Tesla charging stations combined with a solar system at a commercial project in Nashville, Tennessee.
"Becoming a Tesla approved vendor provides Solar Alliance customers with the opportunity to access a high-quality electric vehicle charging station installation," said Solar Alliance CEO Myke Clark. "We now have the ability to install standalone Tesla charging stations for homeowners, but more importantly, we can integrate Tesla electric vehicle chargers into our residential and commercial solar system products. Offering Tesla charging stations is particularly important to our new home builder and contractor clients that are constructing high performance homes. As electric vehicles begin to saturate the market, electric vehicle chargers are becoming increasingly critical to the relevance of a new home and ultimately to the resale value of a home," concluded Clark.
The project in Nashville, where we are installing a solar system and six Tesla charging stations, is the perfect example of the synergies between solar and electric vehicle charging. According to the latest International Energy Agency forecast, the number of sales of electric vehicles will increase from a record 1.1 million worldwide in 2017, to 11 million in 2025 and then surging to 30 million in 2030 as they become cheaper to make than internal combustion engine cars. The Volkswagen Group is going to shift its fleet to 100% electric by 2030. This massive shift to electric vehicles will require a substantial shift in terms of electrical demand and drive the further adoption of residential and commercial solar. 

Solar Alliance is a fully licensed general contractor staffed by North American Board of Certified Energy Practitioners (NABCEP) engineers and installers. Our team is licensed to complete a broad range of electrical work and the addition of Tesla products to our list of offerings provides our customers with a quality product installed by a team they can trust. The Tesla electric vehicle charging station is now an option that can be included in the Solar Alliance SunBox residential solar product. SunBox is a complete solar solution that includes battery storage to maximize energy savings and provide an added layer of security for high performance homes. SunBox comes in two standard residential systems sizes with options such as a generator for whole home backup and a home electric vehicle charger.
The Company also announces that the balance of the private placement announced on February 11th, 2019, is proceeding having been granted a 30-day extension by the TSX Venture Exchange."
The private placement being filled at 3 cents is the most likely reason why the stock hasn't already gone to $0.20. There are only 16.7 million units so the remaining open portion will be filled in short order and people will have to chase shares on the open market. Also, the private placement will be subject to a four month hold. If people want to play the volatility today, they will have to buy on the open market. Trading the stock from 7 cents to 15 cents in a few days is more profitable than buying the private placement at 3 cents and holding for four months, hoping it will stay over 7 cents (though in this case, we think it will).

Two key items to take away from this news release:

1. SOLR has become a vendor for Tesla with the installation of six charging stations in Nashville.
2. SOLR has expanded to charging stations in general, announcing an expansion from its traditional solar business.

Attaching itself to a big player like Tesla is gold for a small cap company. This news could make SOLR move huge even beyond what it has already done as it gets disseminated in the wider media over the next few days. If the electric vehicle market is going to take off, demand for residential power will increase. Imagine how that will look during summer time, when grids are already strained from air conditioning. SOLR's one-two punch of being able to install residential charging stations as well as solar solutions will give it an extreme competitive advantage. SOLR has a market cap of $14 million Canadian. For comparison, Blink Charging Co. (BLNK) has a market cap of $75 million. We think based on today's developments, the relationship with Tesla and recent deals in the solar space, a $25 to $50 million US market cap is a reasonable short term target, meaning the stock can go up 2x to 4x from here. Investors are encouraged to do their own research to come to their own conclusions.

Disclosure: We are long SOLR.V

2019 got off to a reasonable start for microcap stocks as the market in general was bullish for the month. There were a lot of stocks that spiked 100-500% in a matter of one or a few days. As we look towards the rest of 2019, we have to figure out what's next for microcap stocks? TradeMiner identifies seasonal trends and market cycles, the Penny Stock Prophet and Microcap Millionaires finds the next big small cap plays in various industries while Addicted to Profits makes trades from a Canadian perspective.

There are also some good books available on microcap stocks and day trading such as:

Mastering Microcaps: Strategies, Trends, and Stock Selection (Bloomberg Professional Library)

The Little Black Book of Microcap Investing: Beat the Market with NASDAQ/AMEX Microcap Stocks, OTCBB Penny Stocks, and Pink Sheet Stocks

Microcap Magic: Why The Biggest Returns Are In Stocks You've Never Heard Of

How to Day Trade for a Living: A Beginner’s Guide to Trading Tools and Tactics, Money Management, Discipline and Trading Psychology

How to Day Trade: A Detailed Guide to Day Trading Strategies, Risk Management, and Trader Psychology

A Beginner's Guide to Day Trading Online (2nd edition)

Stock Investing for Beginners: Marijuana Stocks


Here are some other good stock market resources. This includes technical analysis and day trading, dividend stock investing, gold and commodities, sector rotation, options trading and microcap trading strategies:

The dividend stock report from dividendstocksonline.com

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