Motley Fool CAPS Rates Clean Energy Fuels

August 14, 2007

Motley Fool's newest venture, Motley Fool CAPS, has collected ratings from more than 60,000 lay and professional analysts, then overweights the most successful raters' opinions to come up with a "CAPS rating" from one to five stars (five being the best).

Today's list of contenders:

	Currently Fetching	CAPS Rating
Clean Energy Fuels (Nasdaq: CLNE)	$15.50	****
Morningstar (Nasdaq: MORN)	$59.17	****
Southwest Water (Nasdaq: SWWC)	$13.32	****
Green Mountain Coffee (Nasdaq: GMCR)	$33.32	***
Blue Nile (Nasdaq: NILE)	$86.00	***
Under Armour (Nasdaq: UA)	$61.97	***
Luminex (Nasdaq: LMNX)	$13.95	**

Companies are selected from the "Institutional Ownership Up Last Month" list published on MSN Money on the Saturday following close of trading last week. Price increase and current pricing also provided by MSN Money on the same date. CAPS ratings from Motley Fool CAPS.

Wall Street's top picks get a generally positive reception from Main Street this week. Three earn ratings above average, and three more just so-so, and only one earns below-average marks. Faced with three four-star stocks to choose between, I'm going to profile the one that (1) has the most ratings to its name, and (2) has the most colorful pitches.

Clean Energy Fuels (CLNE) is the pioneer in providing natural gas for fleet vehicles. The firm was founded by Boone Pickens ... Does this guy know how to make money? Hint: he started Mesa with a bachelor’s degree in geology and $2,500. His net worth is now somewhere north of $3 billion. ... And does anybody know more about energy than Boone Pickens? None of the major networks must believe so because BP is always their first choice for an opinion on energy issues. ... don't bet against Boone Pickens. Mid to long-term, Clean Energy is a winner.

Clean Energy Fuels is driving with gas. Natural gas, that is. The company operates about 170 gas stations in the US and Canada where its 200 customers can tank up their fleet vehicles with compressed natural gas (CNG) or liquefied natural gas (LNG). Clean Energy also helps customers buy and finance natural gas vehicles and obtain government incentives. The company buys CNG from local utilities and produces LNG at its 35-million-gallon-capacity plant in Texas.

Germany already has NG filling stations, and a friend reports that his gasoline equivalence is 140 mpg. ... Businesses with large fleets (UPS, municipal bus systems, taxis, etc.) will be first to invest and adopt in NG fuel. ... Once the concept is clearly in people's mind, people will buy NG cars, and fill up at home (its already being done) ... Once that concept is clearly in people's mind, retail NG filling stations will use the extensive NG pipe network to create retail NG filling stations.

The firm only debuted on the Nasdaq in May, and has not yet filed an earnings report -- so we've got very little in the way of a track record to work with. What we do know is that while Clean Energy has been growing its sales and gross margins, its operating and net margins are drowning in red ink. Also, poetically for a natural gas distributor, Clean Energy's business continues to be fueled by burning cash -- nearly $33 million of it over the last 12 months.

On the plus side, with the cash it raised from its IPO should suffice to keep Clean Energy on the road for at least the next four years at that current rate of cash consumption.