Looking forward, it seems like all of the cards are lined up for Energy Conversion Devices (ENER) to have an impressive year in 2008. In addition to the cost cutting and business rationalization going on inside the company, all three of the businesses-driving results should have positive news in 2008. ENER's United Solar segment is the only major solar manufacturer that produces flexible, lightweight solar panels that can be used as roofing material. About 30% of U.S. commercial buildings would need reinforcement to install a large solar system, and United Solar can eliminate that cost. This segment is also in the midst of a huge expansion, from producing 58 megawatts of solar capacity in 2007 to 175 megawatts in 2008. They will steadily add production lines to the new factories and get to 300 megawatts by 2010. Half of their sales are exports, so they will also benefit from the weak dollar.

The second leg of the business is ENER's one-third interest in Ovonyx, the semiconductor memory company. Early in 2008, Intel (which is a shareholder in Ovonyx) will introduce a 128-megabit part code-named Alverstone, and Samsung will produce a 512-megabit part later in the year. The technology is also licensed to Elpida, Hynix, Qimonda and ST Microelectronics. It will initially replace NOR flash memory in cell phones, but I expect it to go on to replace NAND flash for digital cameras and other storage applications. It could eventually replace DRAM, but it will take a while to get the cost down.

The third leg is ENER's 50% interest in the Cobasys joint venture with Chevron, manufacturing nickel-metal hydride (NiMH) batteries for hybrid cars and other applications. The two companies are in arbitration over what to do with Cobasys, and I expect either Chevron to buy out ENER's interest or the two companies to agree to take Cobasys public. In short, ENER has a very good fundamental outlook for 2008.