I've written about the company's promise in my Game-Changing Stocks
newsletter since before its shares
even went on the market
. (And, not to put to fine a point on it, but I've also long said the president would use ARPA-E findings on the campaign trail.)
Why do I say the president already knows algae works?
Because Solazyme is already selling fuel to the U.S. Navy -- also to United Airlines (NYSE: UAL)
The company also sells other products made from the various oils it derives from algae. Its biggest customer for these oils is the giant European personal goods company Unilever (NYSE: UL)
. It uses these oils to market a popular algae-based skin care line sold at Sephora, one of the nation's leading cosmetics retailers. It even has a foods division that makes flour from algae.
Now, can algae deliver the fuel of the future? That's the wrong question.
It's the wrong question because we already know the answer -- yes, it can -- and Mr. Obama knows it. So do investors who are buying shares of Solazyme and the analysts who are slapping "outperform" ratings on the stock.
Risks to Consider: I typically recommend most investors reserve 20% of their portfolio for stocks like Solazyme. You have to be willing to tolerate some volatility -- but the rewards can be tremendous.
Action to Take -->
Do your own algae study. Check out what this exciting company is doing. (You can read about it in my newsletter, Game-Changing Stocks
, where I covered Solazyme in a recent issue.)
After you take a look, I think you'll see what I see -- which is that these shares were made for aggressive growth investors with a long-term time frame to reap outsized returns.
Andy Obermueller does not personally hold positions in any securities mentioned in this article. StreetAuthority LLC does not hold positions in any securities mentioned in this article.