One of the largest problems for farmers is getting sufficient supply of water to their fields. The other problem — which Kevin Kerr, editor of Resource Trader Alert, recently wrote about — is the cost of fuel.

You’ve heard the stories about truckers striking on highways and national “Don’t gas up” days, and now you are starting to hear about farmers unable to fuel their tractors. That’s a major concern as the price of diesel — which is used in over 95% of tractors and other farm equipment — reaches $4.25 per gallon.

Even if you read Kerr’s blurb, you may not be aware of the impacts that fuel and electricity prices have on water supply. We’re talking the powering of irrigation equipment…

Today, dear reader, we have the solution…and one micro-cap with the technology to solve this problem…

The story of 2007 was solar power. We’ve talked about it a hundred times. Everyone that was interested in the next big alternative energy last year bought every company even remotely connected to solar power. Take for instance First Solar…

As you can see, investors bid the price of this stock up to $267 per share from $28.50 in just a few months. Well, the same is true for this next company I recently stumbled upon. However, this one should outperform the rest this year.

Worldwater & Solar Technologies, Inc. (WWAT: OTC) is a solar technology development company that focuses on farmers’ needs. The company’s lead product, AquaMax, is the simplest answer to the highly complex irrigation problem.

You see, powering the massive irrigation systems of our beloved Great Plains is a huge problem. Sure everyone is focusing on how to bring new energy onto the grids, but no one — that is until now — has thought outside the box (or grids in this case).

AquaMax is a very simple, yet innovative, development. It works like this…

A series of solar panels are set up on the farm, which tie into the power grid already in place. This gives the farmer his own secondary source of power, which juices up the underground water pumps used in the irrigation system:

This does a number of things, which the company’s website does a great job of explaining in this chart:

As you can see, AquaMax keeps the water flowing even if the grid goes down, saves the farmer thousands of dollars when the sun is shining, and eases the strain on pump motors — which increases the lifespan and costs of replacement of the motors.

Now, of course this company doesn’t come with a guaranteed profit. In fact, much of the anticipated growth is already factored into the shares of Worldwater.

Last year, from the January 1 to mid-summer, shareholders had the chance to pocket over 530% gains! But, as everything else in the market fell apart, so did shares of Worldwater…giving back nearly 50% since its peak. That may or may not give us a buying opportunity.

But, I will say this…any company with a technology like this to save farmers right now, might see very similar or better results over the next few years.

Sincerely,

Jim Nelson
April 29, 2008

P.S.: Now, we aren’t recommending that you buy this company (although, that is completely your call). But even if we wanted to, we couldn’t. You see, with the number of Penny Sleuth readers in the hundreds of thousands, over-the-counter companies are a bit too small…

Jim Nelson

Jim Nelson is the managing editor of Penny Sleuth. He has been playing the stock market since he was 14, always with a preference toward smaller companies. He has honed his stock picking skills at Agora Financial since 2004, effectively combining a growth and value approach. Like Greg Guenthner, Jim also contributes to Penny Stock Fortunes on top of bringing you the Penny Sleuth every weekday.

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