Motley Fool
0
All posts from Motley Fool
Motley Fool in Motley Fool,

Why Westport Fuel Systems Inc's Shares Popped 12% Today

What happened

Shares of Westport Fuel Systems Inc (NASDAQ: WPRT) jumped as much as 12% in trading Tuesday after announcing a new development and supply agreement with Indian auto manufacturer Tata Motors. This is the second pop in recent weeks following a memorandum of understanding with Weichai Power in late December. Shares were holding up well and trading 11.3% higher at 11:55 a.m. EST.

So what

Westport will develop and supply solutions for Tata Motors's 4-cylinder and 6-cylinder natural gas commercial vehicles, which will need to meet the Indian government's BS-VI emissions standards by April 2020. This adds to a partnership that began in 2012 to meet previous BS-IV standards for commercial vehicles.

Image source: Getty Images.

The financial impact of the agreement wasn't announced, but Westport said technology for the new product would reduce tailpipe NOx emissions by 87% and methane by 55%.

Now what

Agreements to develop and sell new products are a positive for any company, but keep in mind that Westport already had an agreement with Tata Motors before this deal. Without projections for revenue or growth it's hard to determine what the financial impact will be. That's why I'm not very bullish on this announcement until we see that it's having a positive impact on the top and bottom line.

10 stocks we like better than Westport Fuel Systems Inc.
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*

David and Tom just revealed what they believe are the 10 best stocks for investors to buy right now... and Westport Fuel Systems Inc. wasn't one of them! That's right -- they think these 10 stocks are even better buys.

Click here to learn about these picks!

*Stock Advisor returns as of January 2, 2018

Travis Hoium has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.