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24
Questor Technology is not a one trick pony in clean-tech
Posted by: Gerry Wimmer
1/24/2016
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TOP IDEAS: Commercial sales of Questor Technology’s (TSXV: QST) waste heat to power clean-tech solutions is a diversification catalyst that could catapult this stock again.




Note: Investorfile's share price accumulation target of $0.65 for Questor Technology Inc. was reached on June 3, 2013. For the record, we do not revise share price targets for our Top Ideas - Small Cap Value Stocks. We have positioned our blog to be one of the first providers for a pragmatic perspective of a small cap company stock's potential worth, where there may be uncovered value that has been largely overlooked by the investment community.


The stock price of Questor Technology Inc. (TSXV: QST - $0.78) has gone on a roller coaster ride. Since our first blog post (See: Questor Technology Inc: A small cap clean-tech company that makes money) the stock had soared 1,215% to a high of $5.00 in 2014. Today shares in Questor Technology trade at a fraction of its previous high, but that is not to say that the stock price cannot move up once again.

Questor Technology is a leading provider of waste gas combustion incineration solutions to improve air quality. The Company's proprietary incinerator technology, which is safe, reliable and very efficient, is deemed a best-of-breed clean-air solution for oil and gas producers needing to comply with stricter EPA emission regulations in the US and new zero-flaring regulations internationally. To date the Company's incinerators have been deployed all over the United States and Canada plus in many other countries worldwide.

The demand for Questor’s clean-air incineration solutions has heightened over the last several years. During this same period, interest in its stock from investors has increased sharply as the Company exhibited substantial year-over-year growth in both revenues and profits in 2014 from the sale of its incinerators to Oil & Gas companies.

But with the collapse of world oil prices and the massive spending cuts by the Oil & Gas industry, Questor’s business model needed to shift to a greater focus on incinerator rentals than sales which, in the short-term, impacted sales growth and profitability. Because the Company’s growth had slowed in 2015, Questor’s stock price dropped significantly over the past 12 months.

But is this stock poised to rise again? We think so.

Early in 2014, Questor Technology acquired ClearPower Systems Inc. ("ClearPower") and since that time it has invested funds to further develop ClearPower’s technology that very efficiently transforms waste heat from any source into power.This technology creates an opportunity to realize "zero-emission power” by utilizing the heat generated from efficient combustion, which can be been used for water vaporization, process heat and power generation.

Recently the Company reported that testing for the prototype ClearPower waste heat to power generator units was completed and the results exceeded expectations, making the product commercial-ready. ClearPower’s technology is positioned to capture the under-served waste heat to power market (under 1 Mega-Watt) and is a cost-effective solution to generate power from dirty gas in a variety of applications, including landfills, water and sewage treatment, tire recycling and agriculture. According to the Company, it is anticipated that the first commercial sales for its waste heat to power technology solutions could occur in the first half of 2016. First sales are likely to industrial companies operating in Ontario or California, jurisdictions that have banned coal power generation.

We believe that the Company’s waste heat to power technology greatly expands the market opportunity and thus investment value proposition for Questor Technology as a diversified clean-tech growth company. If the Company can demonstrate that its future growth prospects are not only tied to the oil and gas market, this would serve as a significant catalyst for Questor’s stock.

Of note: During the oil industry downturn, the Company has maintained a strong balance sheet with cash in the bank and no debt.

Questor Technology has approximately 26 million shares outstanding.

The Company’s website www.questortech.com

Author Ownership Disclosure: TSXV: QST- YES


Read Disclaimer:

This article is for informational purposes only. This article is based on the author's independent analysis and judgment and does not guarantee the information's accuracy or completeness. The information contained in this article is subject to change without notice, and the author assumes no responsibility to update the information contained in this article. The information contained within this article should not be construed as offering of investment advice. Those seeking direct investment advice, should consult a qualified, registered, investment professional. This is not a direct or implied solicitation to buy or sell securities. Readers are advised to conduct their own due diligence prior to considering buying or selling any stock.

Investorfile.com is not engaged in an investor relations agreement with Questor Technology Inc. nor has it received any compensation from Questor Technology Inc. for the preparation or distribution of this article.

The author of this article has acquired and may trade shares of Questor Technology Inc. through open market transactions and for investment purposes only.

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Comments:
Posted by: Murray
What prompted your update Questor? Has the company indicated that it's new product is being well-received?

The update on Questor Technology was compiled from information in public filings and from a discussion with management of the Company.

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Hi Gerry, Your philosophy is focused on principles that have been shown to produce above average results over time and your record has clearly proven that. Congratulations on a great blog and thank you for the hard work that you do in sharing and updating your ideas; it is much appreciated.