IPO Stock Of The Week: Renewable Energy Leader Montauk Tests Latest Buy Point

A recent addition to the IBD IPO Leaders list, renewable energy provider Montauk Renewables (MNTK) is a top IPO stock to watch. Montauk is testing its latest buy point following a recent breakout move.

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IPO Stock To Watch: Montauk Renewables

Founded in 1980, Pittsburgh-based Montauk is a renewable energy company specializing in the recovery and processing of biogas from landfills and other sources, for use as a fossil-fuel replacement. It develops, owns and runs renewable natural gas (RNG) projects.

Montauk uses these technologies to supply renewable fuel for the transportation and electrical power sectors. In July, it filed a provisional patent application pertaining to a combustion-based oxygen removal, condensate neutralization technology.

The energy leader earned 13 cents per share in the most recent quarter, much better than the 3-cent loss posted in the same quarter last year. Better yet, revenue more than doubled vs. the year-ago period, reaching an impressive $67.9 million.

IPO Leader Tests Buy Point

Montauk Renewables stock is a recent addition to the IBD IPO Leaders list, which utilizes special screening criteria to find up-and-coming stocks with strong fundamental and technical traits.

Shares broke out on Aug. 18, lifting above the cup base’s 16.75 buy point, but have cooled off during the recent downturn. The stock violated the entry price during Thursday’s 7.7% dive, triggering the round-trip sell rule.

However, Montauk is rebounding on Friday, lifting back above the recent buy point. Clearly, it’s a top IPO stock to watch in this difficult market environment.

In addition, the relative strength line hit a new high during the breakout move, confirming the IPO stock is an emerging market leader. The RS line measures a stock’s price performance vs. the broad market.

Also in this industry group, IBD Leaderboard stock Cheniere Energy (LNG) is pulling back sharply, but remains above a 150.10 buy point.

Follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on IPO stocks.

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