JBL: Profiting From Energy Independence

When President Bush claimed we were addicted to oil, alternative energy stocks surged, ethanol in particular. The only two pure plays on this traditionally corn-based fuel, Pacific Ethanol (PEIX Quote) and Xethanol (XTHN Quote), are each up threefold since the beginning of the year.

Even with those returns behind them, I believe these stocks still have plenty of upside. Ethanol is the new dot.com, except unlike all those Internet stocks that crashed and burned at the beginning of the decade, ethanol-focused companies will have earnings that live up to the hype.

Before I explain why this is so, I'd like to note that ADM (ADM Quote) is up almost 50% since the beginning of the year, and Deere (DE Quote) is up 20% because farmers have more money. That's in part thanks to increased demand for corn for ethanol. If you're a regular reader of mine, you will know that I was  way ahead of the government and the market on these alternative energy issues. ...