Fuel Systems Solutions, Inc. (FSYS) announced yesterday the company would be introducing a Sequent Direct Injection system enabling gasoline-powered vehicles to be converted to operate on liquefied petroleum gas.The system was introduced at the International Automobile Exhibition in Bologna, Italy last week. The company announced the certification program would take until February 2007. After the certification, Fuel Systems Solutions will commence sales of the product. The initial sales goal in Italy is approximately $1.0 million from aftermarket vehicle conversions.
Mariano Costamagna, the president and CEO of Fuel Systems Solutions stated, “Direct fuel injection is an emerging technology being utilized by original equipment manufacturers, enabling the fuel source to be efficiently delivered directly into the combustion chamber of the vehicle at a pressure of 40/100 bar (580/14500 PSI). Prior to the introduction of our new technology, which is an industry first, it was not possible to convert gasoline-powered direct injection systems to operate on gaseous fuels.
This new technology complements the company’s leadership position within the gaseous fuel conversion market for vehicles utilizing traditional fuel injection systems. We look forward to leveraging our industry position to take full advantage of the emerging direct fuel injection vehicle market.”
In his comments, Costamagna said the development of this new system resulted from a one-and-a half year R&D program. The company, as part of the R&D program, successfully outfitted ten vehicles with the system to test for durability and performance.
The exhibition in Bologna placed particular importance on eco-friendly vehicles and services, with areas dedicated to such topics for automobile repair mechanics, garages and dealers. In addition, it showcased vast displays of components and accessories addressing the conversion of vehicles to natural and liquefied petroleum gas — including both aftermarket and OEM systems.
Thursday Volume and Price
Yesterday, the Fuel Systems Solution stock price was up 3%. Option trading volume was up 231% above the average, and stock-trading volume was up 131%.
New Orders and Revenue:
Fuel Systems Solutions, Inc. announced yesterday it has received initial OEM orders of approximately $6.0 million of vehicle emissions systems enabling OEM customers to meet the new emissions standards coming into effect in January 2007.
The company indicated it expects revenue from industrial customers needing to meet the new emissions standards to increase by around 20 percent over the next year.
Mariano Costamagna, the president and CEO of Fuel Systems Solutions stated in a press release, “These initial orders represent a ramp up of business related to the new emissions regulations for the industrial market. Based on our experience with previous EPA and CARB mandates, new emissions regulations typically produce a gradual increase in business rather than extraordinarily large orders all at once. We look forward to working closely with our OEM customers to support them in meeting requirements for the new emissions standards.”
Competitors
Competitors for FSYS include: Delphi Corp. (DPHIQ.PK), Aisan Industry Co., Ltd. (private), and Robert Bosch GmbH (private).
Company Profile
Fuel Systems Solutions, Inc. designs, manufactures, markets, and supplies products to enable vehicles to run on clean burning gaseous fuels, such as natural gas, propane, and biogas. The company was formerly known as Airsensors Inc and changed its name to IMPCO Technologies Inc. in September 1997. The company changed its name to Fuel Systems Solutions, Inc. in August 2006. The company was founded in 1958 and is based in Santa Ana, California.
Potential Trade
With increased environmental regulation, and with Fuel Systems Solutions proprietary technology, the company is looking bullish, A potential covered call position was found using the robust option search tools found on PowerOptions’ website:
| Fuel Systems Solutions Inc. (FSYS) $ 18.77 (37 days to expiration) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| OPTION | Expiration /Strike |
Opt. Bid |
%Dnsd. Prot |
%If Unch. |
%If Asgnd |
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| JQQAW | 07 JAN 17.5 | $1.80 | 9.60% | 3.10% | 3.10% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
This trade offers exceptional 9.6% downside protection while maintaining a respectable 3.1% potential profit in only 37 days.
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[tags]International Automobile Exhibition, Bologna, Italy, Mariano Costamagna, OEM, EPA, CARB, Aisan Industry Co., Ltd., Robert Bosch GmbH, Airsensors, IMPCO Technologies, Santa Ana, California, FSYS, Fuel Systems Solutions Inc., covered call investing, covered call investment strategy, investment strategy, iron condor, option income, poweroptions, selling naked puts, stock option trading, stock options[/tags]