Quantum Technologies (NASDAQ: QTWW) continues to gain notoriety in the market as a potential hedge against soaring fuel prices and a diversified investment into the alt-energy space.

The stock has been in for a wild ride since bouncing off of its 52-week low of $.37 and running all the way up to its 52-week high of $2.95 on 6/5. After retreating back into the $2.10 range last week, shares have rallied yet again and are now trading at around $2.55.

Despite having no earnings and being extremely tight on cash flow QTWW has inked a number of high potential deals in red hot industries including solar and hydrogen power. Quantum also recently disposed of its flailing Tecstar business segment, which was its only non-alt energy focus and would have buried the company in the not so distant future if operations continued.

I’m not sure if the market is betting on a future buyout from an auto industry giant or just simply enamored by Quantum’s diversified position in the sexy land of alternative energy. Either way, I still am not convinced at this point that the company is worthy of my $2.50.

Quantum Technologies (NASDAQ: QTWW) shares continue to drop from Friday’s open of $2.95. Currently trading at $2.15 on volume of roughly 1.7 million shares traded, the stock continues to give back recent gains.

The company made a rather interesting announcement on Tuesday regarding its contract win with EDAG Engineering + Design AG (EDAG) for a Future Steel Vehicle program sponsored by WorldAutoSteel, the automotive group of the International Iron and Steel Institute (IISI). Under the terms of the agreement, Quantum will be responsible for the development of advanced plug-in hybrid electric vehicles (PHEV) and hydrogen fuel cell hybrid vehicles.

Speaking about the potential of the project, QTWW CEO Alan P. Niedzwiecki had this to say: “Demand for Quantum’s innovative hybrid electric powertrain designs and experience in taking alternative propulsion system concepts into production continues to grow worldwide. We look forward to working with EDAG and IISI-WorldAutoSteel on this exciting integration of advanced lightweight vehicle structures with our advanced hybrid powertrains.” “With oil prices above $130.00 a barrel and the national average of a gallon of gas exceeding $4.00 a gallon, there is growing demand worldwide for energy efficient transportation. IISI’s vision for the development of a Future Steel Vehicle clearly addresses this need.”

Despite shares losing value over the past few trading sessions, I will be watching the company closely as it does hold quite a bit of potential for future growth. With gas prices rising about $.10 per day in my neck of the woods, I’m quite aware of the need for alternative energy, particularly in the transportation and residential marketplaces. QTWW is playing in those very areas and making some major inroads in all three of the hydrogen, solar, and battery-power industries.

Quantum Technologies (NASDAQ: QTWW) gave back nearly 25% or $.67 in trading today. A correction after a run-up from a price of $.50 just a few short months back? Surely. The question however, remains “why?”

I can’t force myself to believe that the dip had anything to do with today’s drop in oil prices, trading has not proven to be quite so closely tied to the commodities’ daily performance.

My guess is that some institutional holders may have taken some due profits off the table, in turn creating a surge of retailing selling in fear that the proverbial sky was falling.

As I could not justify splurging on shares in the $1.28 range and up, the drop today does not shock me. However, if we see this one go sideways for a trading session or two and the market realizes that nothing has really changed since before Monday, we could see the stock pushing back up to the $3.00 range for more profit taking.

Since we last spoke about the company on 5/29 Quantum Technologies (NASDAQ: QTWW) at $2.47, shares traded up to a new 52-week high of $2.95 last week before settling down to a current price of $2.88.

The company announced a revised financing agreement Thursday that could mean further dilution to the stock down the road, but investors appear to have shrugged it off.

RedChip Independent recently initiated research on the company. Here’s what analyst Harry Russell, MBA had to say:

“Quantum has made several solid decisions as of late in light of oil prices, the economy, and the government’s stance on alternative energy. By shedding its financially cumbersome Tecstar business unit and concentrating on environmentally friendly business units that work symbiotically, the Company is poised for revenue growth, margin expansion, and various economies of scale. In addition, it has strong relationships with large players carrying financial, technological, and political acumen, the most notably of which is General Motors (GM).”

“Quantum has taken a core business of selling propulsion systems to GM and is now developing hybrid vehicles using its affiliate’s batteries, design acumen and expertise, and photovoltaic solutions. By so doing, Quantum has generated several large contracts which could be expanded and prove wildly lucrative, while at the same time reducing its exposure to traditional fuel-driven businesses,” Russell continued.

“With rapid revenue growth and higher gross margins expected to lead to sustainable bottom-line profits by 2010, this transition window provides a timely investment opportunity. We recommend accumulation of shares and rate QTWW a ‘Speculative Buy’ with a 12-month price target of $4.00,” he concluded.

Since we first brought you Quantum Fuel Systems Technologies Worldwide Inc. (NASDAQ: QTWW) on the 11th at a price of $1.28, the stock has nearly doubled and now trades at $2.47, $.09 off of its 52-Week high.

Quantum Technologies (QTWW) shares closed in the green again on Wednesday at $2.22 for gains for $.12 or 5.71%. The stock hit a daily high $2.56 before giving back $.34 on nearly 12 million shares traded.

Be warned however, that there has been a lawsuit filed against Fisker Automotive, QTTW’s partner in developing the Karma, one of, if not the first luxury hybrid plug-in car in the world.

While there is no certainty that these claims will make it to court, or stand up there if they make it, this just goes to show that there is always some level of risk in every stock and typically there is more risk than what first meets the eye.

Today’s move upward on massive volume of 12.8M shares, far more than the way above average 7.8M traded yesterday is another very bullish sign. That being said, I can’t argue against the stock closing up tomorrow again.

Ultimately, my hesitance to load the boat on Quantum Fuel Systems Technologies Worldwide Inc(NASDAQ: QTWW), last Monday cost me dearly.

The dip back into the $1.10 range from $1.28 that I had hoped for never happened. News out over the past week has simply been too positive. Instead, the stock ran up to $2.10 today – $.20 off of its 52-Week high – on the highest daily volume since June.

News out of the company today states that Quantum’s 25% owned German partner – Asola Advanced and Automotive Solar Systems GmbH – is tripling their annual solar module manufacturing capacity in response to growing European demand.

QTWW also stated plans to expand its ownership position in Asola and announced that the companies have jointly “entered into a long-term supply agreement with Ersol Solar Energy AG for the procurement of 155 MW of high-efficiency silicon photovoltaic solar cells, starting in 2008. ”

The relationship is already expected to yield $600 million in combined sales. With its 2007 revenues approaching $167 million, the Asola partnership is one of Quantam’s biggest assets.

Announcement of a long-term solar cell agreement with Ersol Solar Energy AG.

Quantum Technologies (Nasdaq: QTWW – News) is up nearly 12% thus far today on abnormally high volume of 4,000,000 shares traded.

The company announced this morning that it is conducting initial tests and trials on many aspects of its Fisker Karma (photo to left). The Karma is a plug-in hybrid that can travel 50 miles a day when charged every night and can reach top speeds of 125, continuously, in Sport Mode. The vehicle is being developed through a joint venture between Quantum and Fisker Automotive Inc.

With more than 80% of daily commuters traveling less than 50 miles a day, the Karma represents an ongoing fundamental shift in the auto industry towards Green vehicles and a major potential change for a U.S. economy currently plagued by exorbitant fuel prices, sky high inflation, and a volatile credit market.

While the $80K price tag may be a bit hard to swallow for many consumers, the concept behind the vehicle is not. With a life expectancy of 10 years and the ability to conceivably be refueled just once annually, the Karma is already gaining traction in the auto market, even prior to models becoming available.

From The Release Today:

“Fisker Automotive is preparing to deliver its first Premium Edition vehicles by fourth quarter 2009. Currently, Fisker Automotive has received more than 500 orders for the Fisker Karma since its 2008 debut at the North American International Auto Show (NAIAS) in January. Fisker Automotive will reach a full production of 1,250 vehicles per month by the end of 2010. The starting estimated MSRP for the Fisker Karma will be approximately $80,000 or EURO 80,000″

Great Blog on the car from the Detroit Car Show