At the request of several people, I have decided to re-start The Small Cap Investor website and I am going to be focusing my attention on "Under The Radar" stocks.
Through an online marketing program, I am developing a large opt-in subscriber stock trader database ... aka, my "traderbase". I expect that the traderbase will be maintained somewhere around 50,000 subscribers. I will be talking stock selections, trading strategies, publishing research and more on small companies that don't receive much exposure and whom I believe offer interesting trading opportunities.
For some companies that I follow I will receive compensation ("Sponsored Research"), for others I will not ("Proprietary Research"). As always, if I have any type ownership, compensation, or other conflict, etc., it will be disclosed. And for the record, I will usually have some type of conflict as I also want to trade these stocks as well.
As many of you know, my focus for the last decade has been primarily focused on the small cap sector. Based on my experience in working as a consultant to over two dozen small cap companies, my belief is that many lightly followed stocks in this sector can experience signficant price appreciation if investors become focused on them and have the ability to buy stock.
My goal is not to simply get short term liquidity into a stock. Although stocks may trade with price volatility and volume changes as a side effect of my coverage, my goal is to introduce investors to stocks that are under the radar and would otherwise go unnoticed. Of course, some of these investors will be short term and some will be long term, but regardless of which type of investor they are, when 50,000 investors decide that a stock that trades under the radar needs to get noticed, it will get noticed in a BIG way.
The service will be 100% free to investors. Once the program is up and running, I will offer additional services for subscribers who wish to upgrade to a "Premium Account". Premium accounts will only cost $99 per year. I believe this cost could be recovered in a single trade. Premium accounts will have full download access to proprietary research, additional resources on the website and will receive The Meehan Report delivered real-time. In the future, Premium Members will receive invitations to conferences, special events and the like.
The Meehan Report will be changing focus and will no longer be a free online blog. It will become my primary communiction tool for trading commentary. The Meehan Report will be delivered to Premium Members upon completion of writing. Subscribers who are part of the "free" traderbase will also receive The Meehan Report, however, it will be on a 24-hr delayed basis.
The platform will have 3 primary components: 1) Research 2) The Small Cap Investor Newsletter and 3) The Meehan Report.
1) RESEARCH: When I see an opportunity in a stock, I will issue a research report with commentary on the stock and why I think it offers an opportunity for price appreciation (or conversely, if I really dislike a stock, why I would short it). I will provide updates to my coverage stocks any time that it seems relevant to do so.
2) NEWSLETTER: I will bring back The Small Cap Investor newsletter. I currently anticipate this will be monthly, but it will depend on how much time it takes me to write and how big it gets.
3) THE MEEHAN REPORT: When I see a piece of interesting news on a stock that I have an interest in, I will send it out to my traderbase. Topics such as trading strategies, news updates, arbitrage opportunities, etc. will all be fair game. I currently expect this to be the primary communication piece.
Again, 50,000 investors with the abillity to buy or sell stock has a lot of power. And, "In The World Of Investments, Knowledge Is Power".
I am currently designing the new website and the layout of communications to members. However, I have set up the database for those who want to get signed up. Again, it is 100% FREE, no strings attached. Premium upgrades are not yet available, but will be as soon as the site goes live.
To be part of the Beta Testing, just sign up at: www.TheSmallCapInvestor.com
Hope to see your name on my list real soon!
~ The Small Cap Investor
(aka: Trey Meehan)
Disclosure: Other business interests:
Meehan Capital Management Group, Inc.
www.meehancapital.com
Registered Investment Advisor
CRD Number: 142115
First Capital Investors, Inc.
www.firstcapitalinvestors.com
Capital Markets Advisory
Primordium Equity LLC
www.primordiumequity.com
Private Equity Management
M3 Venture Capital LLC
www.M3VC.com
Tuesday, December 2, 2008
Tuesday, November 11, 2008
OPTIMIZERx (OTCPK: OPRX)
As per the terms of the $3.5 million funding agreement that it received in September, OPTIMIZERx filed its Form S-1 with the SEC on Monday. (I didn't see the filing show up on EDGAR, so I called the Company and they indicated that it was filed late in the day and would not show up until Wednesday due to Veterans Day.) The filing clears the way for the Company to eventually move to NASDAQ once the registration statement is deemed effective by the regulatory bodies.
Although OPTIMIZERx is still a young company, the management team is a group of seasoned veterans and they have aligned with company with a couple of the largest players in the industry through their partnership with Cegedim Dendrite (Paris: CGM) and also S&H Digital of Sudler & Hennessey, a division of WPP Group (NASDAQ: WPPGY or London: WPP).
Cegedim Dendrite (www.dendrite.com) provides pharmaceutical companies around the world with vital support for successful Customer Relationship Management (CRM) activities. With nearly 200,000 sales representatives using its products worldwide, Cegedim Dendrite is the world's leading CRM provider for the life sciences industry. This business unit, created in May 2007 when the France-based CEGEDIM S.A. Group acquired Dendrite International, also provides sales, marketing and regulatory compliance solutions in more than 80 countries.
Sudler & Hennessey (www.sudler.com) is a global healthcare marketing and communications organization with offices around the world. The network includes two global communications agencies – Sudler & Hennessey, with U.S. headquarters in New York City, and Sentrix Global Health Communications, with U.S. headquarters in Berkeley Heights, New Jersey. S&H also has specialized divisions in medical education (IntraMed Educational Group, Precept Medical Communications, and Current Medical Directions), as well as in market research and strategic planning, branding, publication strategies, sales training (HealthAnswers), and digital solutions (S&H Digital).
I think this Company bears taking a very close look at for those who want to get into a small company that has not yet been put in front of the masses. The market that they serve is enormous and they are positioning themselves right in front of a massive wave as the baby boomer generation ages and prescription medications become a larger component of everyday life.
DISCLOSURE: I am a consultant to OPTIMIZERx and own stock in the Company. On my First Capital Investors website I have an investor fact sheet available on their client page @ http://www.firstcapitalinvestors.com/client_optimizerx.php
Although OPTIMIZERx is still a young company, the management team is a group of seasoned veterans and they have aligned with company with a couple of the largest players in the industry through their partnership with Cegedim Dendrite (Paris: CGM) and also S&H Digital of Sudler & Hennessey, a division of WPP Group (NASDAQ: WPPGY or London: WPP).
Cegedim Dendrite (www.dendrite.com) provides pharmaceutical companies around the world with vital support for successful Customer Relationship Management (CRM) activities. With nearly 200,000 sales representatives using its products worldwide, Cegedim Dendrite is the world's leading CRM provider for the life sciences industry. This business unit, created in May 2007 when the France-based CEGEDIM S.A. Group acquired Dendrite International, also provides sales, marketing and regulatory compliance solutions in more than 80 countries.
Sudler & Hennessey (www.sudler.com) is a global healthcare marketing and communications organization with offices around the world. The network includes two global communications agencies – Sudler & Hennessey, with U.S. headquarters in New York City, and Sentrix Global Health Communications, with U.S. headquarters in Berkeley Heights, New Jersey. S&H also has specialized divisions in medical education (IntraMed Educational Group, Precept Medical Communications, and Current Medical Directions), as well as in market research and strategic planning, branding, publication strategies, sales training (HealthAnswers), and digital solutions (S&H Digital).
I think this Company bears taking a very close look at for those who want to get into a small company that has not yet been put in front of the masses. The market that they serve is enormous and they are positioning themselves right in front of a massive wave as the baby boomer generation ages and prescription medications become a larger component of everyday life.
DISCLOSURE: I am a consultant to OPTIMIZERx and own stock in the Company. On my First Capital Investors website I have an investor fact sheet available on their client page @ http://www.firstcapitalinvestors.com/client_optimizerx.php
Thursday, November 6, 2008
Announcement: The Small Cap Investor Is Back
At the request of several people, I have decided to re-start The Small Cap Investor website and I am going to be focusing my attention on "Under The Radar" stocks.
The way it will work is this: Through an aggressive marketing program, I will develop a large opt-in subscriber stock trader database ... aka, my "traderbase". I expect that the traderbase will be somewhere around 50,000 members. I will be making stock selections that I believe offer interesting trading opportunities. For some picks I will receive compensation, for others I will not.
As always, if I have any type of conflict of interest, it will be disclosed. And for the record, I will usually have some type of conflict as I want to own these stocks as well. Assuming that I like a stock, if a company wants to pay me to introduce it to my traderbase, even better!
As many of you know, my focus for the last decade has been primarily focused on the small cap sector. Based on my experience in working as a consultant to over two dozen small cap companies, my belief is that many lightly followed stocks in this sector can experience signficant price appreciation if investors become focused on them and have the ability to buy stock.
My goal is not to simply get short term liquidity into a stock, although that may be a side effect. My goal is to introduce investors to stocks that are under the radar. Some of these investors will be short term, some will be long term. Regardless of which type of investor they are, when 50,000 investors decide that a stock that trades under the radar needs to get noticed, it will get noticed in a BIG way.
In the beginning the service will be 100% free to investors. Note: I reserve the right to offer additional services for a fee in the future, as well as conferences and the like, but in the beginning everything will be free.
The platform will have 3 primary components: 1) Research & Commentary, 2) Newsletter and 3) News Alerts.
1) RESEARCH & COMMENTARY: When I see an opportunity in a stock, I will issue a research report with commentary on the stock and why I think it offers an opportunity for price appreciation (or conversely, if I really dislike a stock, why I would short it). I will provide updates to my coverage stocks any time that it seems relevant to do so.
2) NEWSLETTER: I will bring back The Small Cap Investor newsletter. Presently, I am not sure if this will be quarterly or monthly as it will depend on how much time it takes me to write and how big it gets.
3) NEWS ALERTS: When I see a piece of interesting news on a stock that I have an interest in, I will send it out to my traderbase.
Again, 50,000 investors with the abillity to buy or sell stock has a lot of power. And, "In The World Of Investments, Knowledge Is Power".
I have not started marketing the program yet, as I have a lot of work to do in the design of the website and the layout of communications to members. However, I have set up the database for those who want to get signed up. Again, it is 100% FREE, no strings attached.
To be part of the Beta Testing, just sign up at: www.TheSmallCapInvestor.com
Hope to see your name on my list real soon.
The way it will work is this: Through an aggressive marketing program, I will develop a large opt-in subscriber stock trader database ... aka, my "traderbase". I expect that the traderbase will be somewhere around 50,000 members. I will be making stock selections that I believe offer interesting trading opportunities. For some picks I will receive compensation, for others I will not.
As always, if I have any type of conflict of interest, it will be disclosed. And for the record, I will usually have some type of conflict as I want to own these stocks as well. Assuming that I like a stock, if a company wants to pay me to introduce it to my traderbase, even better!
As many of you know, my focus for the last decade has been primarily focused on the small cap sector. Based on my experience in working as a consultant to over two dozen small cap companies, my belief is that many lightly followed stocks in this sector can experience signficant price appreciation if investors become focused on them and have the ability to buy stock.
My goal is not to simply get short term liquidity into a stock, although that may be a side effect. My goal is to introduce investors to stocks that are under the radar. Some of these investors will be short term, some will be long term. Regardless of which type of investor they are, when 50,000 investors decide that a stock that trades under the radar needs to get noticed, it will get noticed in a BIG way.
In the beginning the service will be 100% free to investors. Note: I reserve the right to offer additional services for a fee in the future, as well as conferences and the like, but in the beginning everything will be free.
The platform will have 3 primary components: 1) Research & Commentary, 2) Newsletter and 3) News Alerts.
1) RESEARCH & COMMENTARY: When I see an opportunity in a stock, I will issue a research report with commentary on the stock and why I think it offers an opportunity for price appreciation (or conversely, if I really dislike a stock, why I would short it). I will provide updates to my coverage stocks any time that it seems relevant to do so.
2) NEWSLETTER: I will bring back The Small Cap Investor newsletter. Presently, I am not sure if this will be quarterly or monthly as it will depend on how much time it takes me to write and how big it gets.
3) NEWS ALERTS: When I see a piece of interesting news on a stock that I have an interest in, I will send it out to my traderbase.
Again, 50,000 investors with the abillity to buy or sell stock has a lot of power. And, "In The World Of Investments, Knowledge Is Power".
I have not started marketing the program yet, as I have a lot of work to do in the design of the website and the layout of communications to members. However, I have set up the database for those who want to get signed up. Again, it is 100% FREE, no strings attached.
To be part of the Beta Testing, just sign up at: www.TheSmallCapInvestor.com
Hope to see your name on my list real soon.
- ~ The Small Cap Investor
Wednesday, October 29, 2008
CryoPort, Inc. (OTCBB: CYRX)
Lions and Tigers and Bears, oh my.
DuPont and Quest and Mayo ... OH MY!
I think that we will start to see operations begin to follow the news over the next 90 days. Be on the lookout for a build up of inventory and subsequent revenues.
As more people begint to learn about this company, in my opinion, the stock will begin to react. I think at this point it is simply a matter of time.
Six months ago, the train was moved from the storage shed to the trainyard. Two months ago, it pulled into the station. Now it is getting filled with fuel and preparing to leave the station. The train's name is: The CryoPort Express.
Out.
DuPont and Quest and Mayo ... OH MY!
I think that we will start to see operations begin to follow the news over the next 90 days. Be on the lookout for a build up of inventory and subsequent revenues.
As more people begint to learn about this company, in my opinion, the stock will begin to react. I think at this point it is simply a matter of time.
Six months ago, the train was moved from the storage shed to the trainyard. Two months ago, it pulled into the station. Now it is getting filled with fuel and preparing to leave the station. The train's name is: The CryoPort Express.
Out.
Monday, October 20, 2008
CryoPort (OTCBB:CYRX) - Coverage Initiation
Meehan Capital Management Group, Inc. published today for public review its October 7, 2008 Equity Report initiated with a Speculative Buy Rating and a 12-18 month price target of $7.50.
To review the report, which will be available for free review until October 31, 2008, click the following link: CryoPort, Inc. (OTCBB: CYRX) - 10-07-2008 Coverage Initiation
NOTE: Effective November 1, 2008, Meehan Capital Management Group will begin offering both Proprietary Research and Sponsored Research Coverage. Proprietary Coverage will be available to clients of the MCMG Private Client Group and available for purchase to interested parties. Our Sponsored Research will be paid for by the Company or a third party and will be available to interested parties at no charge.
Disclaimer: I received NO compensation for the writing of the research on CryoPort. From April 2005 thru August 2007, I served as a consultant to CryoPort and received minimum compensation in that position (mostly reimbursement of expenses). I have not been affiliated with the firm since August 2007. I do own stock and warrants in CYRX. See disclosure in the research report for additional disclosure material.
To review the report, which will be available for free review until October 31, 2008, click the following link: CryoPort, Inc. (OTCBB: CYRX) - 10-07-2008 Coverage Initiation
NOTE: Effective November 1, 2008, Meehan Capital Management Group will begin offering both Proprietary Research and Sponsored Research Coverage. Proprietary Coverage will be available to clients of the MCMG Private Client Group and available for purchase to interested parties. Our Sponsored Research will be paid for by the Company or a third party and will be available to interested parties at no charge.
Disclaimer: I received NO compensation for the writing of the research on CryoPort. From April 2005 thru August 2007, I served as a consultant to CryoPort and received minimum compensation in that position (mostly reimbursement of expenses). I have not been affiliated with the firm since August 2007. I do own stock and warrants in CYRX. See disclosure in the research report for additional disclosure material.
Wednesday, October 8, 2008
Update: Gateway International Holdings
After a much anticipated 2 year waiting period, I am pleased to report that on Wednesday, October 1, 2008, Gateway International Holdings, became a fully reporting Company once again by filing its Form 10k annual report with the Securities and Exchange Commission.
I wish to extend a word of congratulations to Tim Consalvi, CEO and Chairman of Gateway Int'l. Tim inherited a difficult sitution and has worked diligently to get the Company back in compliance with the SEC. I would also like to thank Steve Kasprisin, who in April returned to assist the Company as a contract CFO. Steve assisted the Company through the filing requirements and I am quite sure that Tim and the Board leaned heavily on Steve for his expertise in these regards.
Now the question is "When will the Company's stock begin trading again?" I have not received comment from the Company on this regard, but based on standard procedures, I would guess that right now the Company is in process of getting a broker/dealer to file a 15c2-11 with FINRA. Once this filing is cleared, the stock could begin trading.
I look forward to seeing this stock trade again. Prior to the SEC's deregistration of the Company's securities, the stock traded as high as $2.35 per share. Based on the information included in the 10k, this price might be a little high given the current economy, but I would not be surprised at all to see the stock settle around $1.50 per share when it begins trading. Last year the Company achieved almost $19.5 million in revenues. There were a lot of non-standard costs that were charged against earnings last year, including legal and filing fees. Historically, the Company has average around 12% pre-tax profit. Not assuming any growth, but simply maintaining during the upcoming 12 months, if the Company achieves 12% margins on equivalent sales, we would expect around $2.35M in profits. On a per share basis, based on reported TSO of 28,378,645, this would equate to approximately $0.083 of earnings per share. The stock has historically experienced internal growth over 25% per year based on ongoing operations. Rather than use aggressive estimates, assume a high end rate of 25% and a low end growth rate of 15%. Utilizing a PEG ratio of 1 (typical value investor model), that would indicate a stock with a fair value in the range of $1.25 to $2.07 per share (hence my middle of the road target of $1.50 per share).
I have liked this little "nuts and bolts" company for a long time. Clients in the MCMG Private Client Group own a fair amount of stock in this company and I remain increasingly optimistic that this investment will provide a very nice, time weighted return.
Disclosure: Through First Capital Investors, I provided consulting services to Gateway Int'l from 2003 thru 2007. I was one of the largest open market purchasers of the stock from 2003 thru 2005 and have purchased shares in private transactions since the deregistration. I continue to hold all of my shares. I have not worked with the Company at any time during 2008.
I wish to extend a word of congratulations to Tim Consalvi, CEO and Chairman of Gateway Int'l. Tim inherited a difficult sitution and has worked diligently to get the Company back in compliance with the SEC. I would also like to thank Steve Kasprisin, who in April returned to assist the Company as a contract CFO. Steve assisted the Company through the filing requirements and I am quite sure that Tim and the Board leaned heavily on Steve for his expertise in these regards.
Now the question is "When will the Company's stock begin trading again?" I have not received comment from the Company on this regard, but based on standard procedures, I would guess that right now the Company is in process of getting a broker/dealer to file a 15c2-11 with FINRA. Once this filing is cleared, the stock could begin trading.
I look forward to seeing this stock trade again. Prior to the SEC's deregistration of the Company's securities, the stock traded as high as $2.35 per share. Based on the information included in the 10k, this price might be a little high given the current economy, but I would not be surprised at all to see the stock settle around $1.50 per share when it begins trading. Last year the Company achieved almost $19.5 million in revenues. There were a lot of non-standard costs that were charged against earnings last year, including legal and filing fees. Historically, the Company has average around 12% pre-tax profit. Not assuming any growth, but simply maintaining during the upcoming 12 months, if the Company achieves 12% margins on equivalent sales, we would expect around $2.35M in profits. On a per share basis, based on reported TSO of 28,378,645, this would equate to approximately $0.083 of earnings per share. The stock has historically experienced internal growth over 25% per year based on ongoing operations. Rather than use aggressive estimates, assume a high end rate of 25% and a low end growth rate of 15%. Utilizing a PEG ratio of 1 (typical value investor model), that would indicate a stock with a fair value in the range of $1.25 to $2.07 per share (hence my middle of the road target of $1.50 per share).
I have liked this little "nuts and bolts" company for a long time. Clients in the MCMG Private Client Group own a fair amount of stock in this company and I remain increasingly optimistic that this investment will provide a very nice, time weighted return.
Disclosure: Through First Capital Investors, I provided consulting services to Gateway Int'l from 2003 thru 2007. I was one of the largest open market purchasers of the stock from 2003 thru 2005 and have purchased shares in private transactions since the deregistration. I continue to hold all of my shares. I have not worked with the Company at any time during 2008.
Tuesday, September 30, 2008
OPTIMIZERx (OTCPK: OPRX)
OPTIMIZERx (OTCPK: OPRX) announced today that it plans to partner with S&H Digital to launch the newest platform to assist in drug promotion and compliance: ADHERxE.
Full press release: OPTIMIZERx to Partner with Sudler and Hennessey.
Many people may not have heard of S&H Digital, but this is actually a very BIG development. S&H Digital is the interactive division of Sudler & Hennessey, which is one of the over 100 companies that make up the WPP GROUP (NASDAQ: WPPGY).
WPP Group, www.WPP.com is a global communications firm based out of London. WPP Group is one of the world's largest communications services groups, with more than 110,000 people working in over 2,000 offices in 106 countries.
WPP common shares are listed on the London Stock Exchange under the symbol WPP. American Depository Receipts (ADR) are traded in the United States on the NASDAQ under the symbol WPPGY.
This is a very important step for OPTIMIZERx as it further builds their brand and helps to put the company in front of every major pharmaceutical manufacturer on the planet.
Recently, OPTIMIZERx announced that they had received $3.5 million in funding from Midtown Partners & Co. LLC a FINRA member and SIPC Broker/Dealer. Given the current credit environment, this funding is looking even more impressive.
Full Press Release: OPTIMIZERx Closes $3.5M Funding
Stay tuned. This one could get interesting.
DISCLAIMER: I handle some public relations services for OPTIMIZERx and received a few restricted shares shortly after they became a public company. I have never sold any stock in this company and have no intention of doing so at this time. I just happen to really like the company and its management, so I agreed to help them on their public relations efforts, primarily regarding their press releases at this time.
Full press release: OPTIMIZERx to Partner with Sudler and Hennessey.
Many people may not have heard of S&H Digital, but this is actually a very BIG development. S&H Digital is the interactive division of Sudler & Hennessey, which is one of the over 100 companies that make up the WPP GROUP (NASDAQ: WPPGY).
WPP Group, www.WPP.com is a global communications firm based out of London. WPP Group is one of the world's largest communications services groups, with more than 110,000 people working in over 2,000 offices in 106 countries.
WPP common shares are listed on the London Stock Exchange under the symbol WPP. American Depository Receipts (ADR) are traded in the United States on the NASDAQ under the symbol WPPGY.
This is a very important step for OPTIMIZERx as it further builds their brand and helps to put the company in front of every major pharmaceutical manufacturer on the planet.
Recently, OPTIMIZERx announced that they had received $3.5 million in funding from Midtown Partners & Co. LLC a FINRA member and SIPC Broker/Dealer. Given the current credit environment, this funding is looking even more impressive.
Full Press Release: OPTIMIZERx Closes $3.5M Funding
Stay tuned. This one could get interesting.
DISCLAIMER: I handle some public relations services for OPTIMIZERx and received a few restricted shares shortly after they became a public company. I have never sold any stock in this company and have no intention of doing so at this time. I just happen to really like the company and its management, so I agreed to help them on their public relations efforts, primarily regarding their press releases at this time.
Friday, September 19, 2008
CryoPort, Inc. (OTCBB: CYRX)
Over the past two weeks I have had numerous private clients and outside investors contact me requesting my opinion on CryoPort (OTCBB: CYRX) and when/if I would make additional comments. Back in the summer, I indicated that "if it became necessary" that I could become an agent of change in this situation. Again, this is only if necessary to protect the interest of my clients. As a Registered Investment Advisor, I have a responsibility to ensure that I am doing everything I can to properly oversee our investments and if it means that I need to get involved in additional ways, I will.
I have been gathering data over the last couple of months, and I am currently putting together an Equity Research Report that I intend to publish through my firm, Meehan Capital Management Group (www.meehancapital.com). My current intention is to publish this Equity Report in October and in the report, I will discuss various aspects of the stock, valuations, potential deals and pitfalls, current financial stability, future financial outlook and more. The names and trading symbols of companies that "I believe" could be doing business with CryoPort in the future will be included in my report.
I am hoping that we will hear some communications from the company before I issue the report as a detailed shareholder communication could clear some unresolved items that I have. I will attempt to once again reach out to company management and I hope that they will speak frankly with me as to the ongoings of the business. If they will not, I will utilize the best information that I have and make an opinion.
I have been told by the Company that the Annual Shareholder meeting will be discussed at the 4th Quarter Board of Directors meeting. Thus far, I have not received clarification as to whether it is "fiscal" 4th quarter or "calendar" 4th quarter (CryoPort's year end is 3/31). In the event that there is not a shareholder meeting held by the end of November, I am considering using the rules set forth in CryoPort's ByLaws to call a shareholder meeting utilizing the appropriate level of shareholder participation. The shareholder meeting will be open to all shareholders and I believe that if company management is forced to meet face to face with its sharholders, they will finally understand that investors want to see action NOW and put additional efforts into closing a deal.
For shareholders who are concerned with the lack of transparency being exhibited by this company, the only thing that I can say is to contact the company and let them know your concerns. I think that most investors out there understand my position by now, but the Equity Report will provide a clear explanation of my opinion of the stock.
In the meantime, I hope that everyone has weathered the current financial fiasco without too much stress and maybe even made a few bucks.
I have been gathering data over the last couple of months, and I am currently putting together an Equity Research Report that I intend to publish through my firm, Meehan Capital Management Group (www.meehancapital.com). My current intention is to publish this Equity Report in October and in the report, I will discuss various aspects of the stock, valuations, potential deals and pitfalls, current financial stability, future financial outlook and more. The names and trading symbols of companies that "I believe" could be doing business with CryoPort in the future will be included in my report.
I am hoping that we will hear some communications from the company before I issue the report as a detailed shareholder communication could clear some unresolved items that I have. I will attempt to once again reach out to company management and I hope that they will speak frankly with me as to the ongoings of the business. If they will not, I will utilize the best information that I have and make an opinion.
I have been told by the Company that the Annual Shareholder meeting will be discussed at the 4th Quarter Board of Directors meeting. Thus far, I have not received clarification as to whether it is "fiscal" 4th quarter or "calendar" 4th quarter (CryoPort's year end is 3/31). In the event that there is not a shareholder meeting held by the end of November, I am considering using the rules set forth in CryoPort's ByLaws to call a shareholder meeting utilizing the appropriate level of shareholder participation. The shareholder meeting will be open to all shareholders and I believe that if company management is forced to meet face to face with its sharholders, they will finally understand that investors want to see action NOW and put additional efforts into closing a deal.
For shareholders who are concerned with the lack of transparency being exhibited by this company, the only thing that I can say is to contact the company and let them know your concerns. I think that most investors out there understand my position by now, but the Equity Report will provide a clear explanation of my opinion of the stock.
In the meantime, I hope that everyone has weathered the current financial fiasco without too much stress and maybe even made a few bucks.
Thursday, September 4, 2008
Update: Gateway International Holdings
Just a quick update to make everyone aware that Gateway International Holdings has filed an ammended Form 10-12.
Amended Form 10-12G
I don't have anything to report at this time, other than it seems evident that management is moving through the process. Given that this is the 2nd amendment (3rd filing including the original submission), I am hopeful that the stock will be reporting and trading during the 3rd or 4th quarter of this year.
Should any positive news that can be reported come my way, I'll keep you posted.
Amended Form 10-12G
I don't have anything to report at this time, other than it seems evident that management is moving through the process. Given that this is the 2nd amendment (3rd filing including the original submission), I am hopeful that the stock will be reporting and trading during the 3rd or 4th quarter of this year.
Should any positive news that can be reported come my way, I'll keep you posted.
Wednesday, August 20, 2008
CryoPort (OTCBB: CYRX)
I have received a number of calls and emails over the last several days asking for my opinion on the CryoPort quarterly report. I have been dealing with and preparations for Tropical Storm Fay, which we thought was going to hit us directly as a potential hurricane, so I have not had time to update before now. Thankfully, my area has thus far been spared a majority of the effects of this storm, but say a prayer for those in the Melbourne, Florida area as they have received in excess of 24" (2 FEET!) of rain over the last 2 days and it is still raining.
As to CryoPort's 10Q. Well, unfortunately it is about what I expected. There is a very small buildup of inventory and they spent about $2M of the cash they have brought in during the past year. Now, if there was something to show for that cash, I would feel a little better. However, unless I am just missing something, I don't see assets on the books that indicate to me that those funds were used for much other than covering operations and old debts. I was hoping for an announcement of some type of deal, but it has not materialized to date. It is hard for me to understand the idea of getting ready to roll out the program in any meaningful way, while having virtually no inventory and having actually shipped very few units, but I feel sure they have their reasons.
I will say this about Mr. Berry. Peter has run a pretty tight ship for several years, often times stretching money as far as it could possibly go. That said, I don't think the company is wasting money. On the contrary, he is generally a very good steward of the funds. My biggest area of concern is that since announcing production began in December, CryoPort has only produced around $100k of product. That would be about $15k (dollars) per month or maybe a couple hundred shippers each month. Something doesn't make sense in that scenario. Either they have not been in manufacturing as we were led to believe with company press releases, or the inventory that was supposedly being built up is not being reflected on the books as one might expect. I suspect that the company has only made as many units as the pilot programs required, which is fine, but it does seem strange to think that the roll out is near, yet no inventory has been created.
I will be asking some questions to try to get some answers and will report my findings on this blog in the future. I have heard rumblings from a couple of sources that indicate there may be something coming soon, confirming the comments in the shareholder letter. However, I can not confirm anything at this time as to either who the deals are with and at what level. Hopefully I can get some clarity over the next couple of weeks. Perhaps there will be news in that time frame.
If I have not received confirmation or clarification as to the business developments alluded to by Mr. Berry in the shareholder letter by the end of August, I will request a firm date for the annual shareholders meeting. Last year this was held in October, and I would expect roughly the same this year. I have several large shareholders, plus myself, that are interested in attending this year's meeting and we need appropriate notice to address any scheduling conflicts so that we can attend. If a firm date is not provided, I will politely help provide one by calling for a shareholder's meeting with the proper notice and voting minimums.
I am hopeful that my involvement as anything other than a shareholder and the biggest cheerleader on the street will become a moot point. However, if we happen to fall back into a communications rut, I don't intend to stay on the sidelines.
As to CryoPort's 10Q. Well, unfortunately it is about what I expected. There is a very small buildup of inventory and they spent about $2M of the cash they have brought in during the past year. Now, if there was something to show for that cash, I would feel a little better. However, unless I am just missing something, I don't see assets on the books that indicate to me that those funds were used for much other than covering operations and old debts. I was hoping for an announcement of some type of deal, but it has not materialized to date. It is hard for me to understand the idea of getting ready to roll out the program in any meaningful way, while having virtually no inventory and having actually shipped very few units, but I feel sure they have their reasons.
I will say this about Mr. Berry. Peter has run a pretty tight ship for several years, often times stretching money as far as it could possibly go. That said, I don't think the company is wasting money. On the contrary, he is generally a very good steward of the funds. My biggest area of concern is that since announcing production began in December, CryoPort has only produced around $100k of product. That would be about $15k (dollars) per month or maybe a couple hundred shippers each month. Something doesn't make sense in that scenario. Either they have not been in manufacturing as we were led to believe with company press releases, or the inventory that was supposedly being built up is not being reflected on the books as one might expect. I suspect that the company has only made as many units as the pilot programs required, which is fine, but it does seem strange to think that the roll out is near, yet no inventory has been created.
I will be asking some questions to try to get some answers and will report my findings on this blog in the future. I have heard rumblings from a couple of sources that indicate there may be something coming soon, confirming the comments in the shareholder letter. However, I can not confirm anything at this time as to either who the deals are with and at what level. Hopefully I can get some clarity over the next couple of weeks. Perhaps there will be news in that time frame.
If I have not received confirmation or clarification as to the business developments alluded to by Mr. Berry in the shareholder letter by the end of August, I will request a firm date for the annual shareholders meeting. Last year this was held in October, and I would expect roughly the same this year. I have several large shareholders, plus myself, that are interested in attending this year's meeting and we need appropriate notice to address any scheduling conflicts so that we can attend. If a firm date is not provided, I will politely help provide one by calling for a shareholder's meeting with the proper notice and voting minimums.
I am hopeful that my involvement as anything other than a shareholder and the biggest cheerleader on the street will become a moot point. However, if we happen to fall back into a communications rut, I don't intend to stay on the sidelines.
Wednesday, August 13, 2008
CryoPort (OTCBB: CYRX)
Today, CryoPort released a letter to shareholders (click HERE to read) from Mr. Peter Berry. While I am pleased to see that the Company is communicating with its shareholders, I am just not quite sure what the point of this particular letter was supposed to address.
In case you have not read it, the letter rehashed much of the same verbage from several prior press releases. Mr. Berry stated that the Company has made significant progress inroads with CRO's (Contract Research Organizations) and that the company has over $2 million in cash on hand which will be enough to support the CryoPort Express Shipper rollout, including manufacturing and recycling.
My first reaction to the shareholder letter is that there are probably not going to be many positives in the Q1 financials that are expected out later this week and this is an attempt to soften the blow.
My second reaction is that this is a method to buy time with shareholders. I understand that when dealing with large companies like FedEx or a big medical company there will be delays and this requires patience. I get that and I am remaining patient as I have been for a number of years.
These two reactions both get back to the same point: What is the point of the letter?
We know that the CryoPort Express Shipper has been completed since January 2007 ( Read January 8, 2007 Release).
We know that after receiving over $4M in net funding last fall, CryoPort started producing shippers ( Read Dec 6, 2007 Release).
We know that CryoPort is partnered up with FedEx (NYSE: FDX), (Read Dec 19, 2007 Release) so I think we can feel fairly comfortable that the product is legit.
We have known for a while that pilot programs were underway for pharmatceutical firms as of April 2007 (Read Apr 23, 2007 Release). Additionally, CryoPort started shipping stem cells for Celprogen in December 2007 (Read Dec 20, 2007 Release).
We know they were shipping internationally for Quest Diagnostics (NYSE: DGX) (Read Apr 17, 2008 Release).
We know that CryoPort received an additional $1.0625M in follow-on investment back in June 2008 (Read June 10, 2008 Release).
So where does all of this information leave investors? Well, I have a couple of items that I will be trying to answer in the near term. Since the company has received $5.0625 million in funding over the last 12 months, and according to Mr. Berry there is currently over $2 million on hand, what has been accomplished with the other roughly $3 million that has apparently been used? This company has always run on a pretty tight operational budget, so unless something has changed in the spending patterns, there should be something else that is absorbing a fair amount of cost. That should not be too hard to determine because CryoPort started manufacturing the express shippers approximately 9 months ago (see news link above). I expect to see some of that production begin to show up in the quarterly reports. If they are shipping pilot programs and manufacturing units as described in press releases and their regulatory filings, I would also expect to see some initial revenue figures begining to show up on the financial statements.
I get the impression that some investors want to see "big" results in the upcoming financials. Prior to the shareholder letter, I did not expect to see much. After the shareholder letter, I do not expect to see much. What is most important from my perspective is that the Company is moving in the right direction. If CryoPort has $2 million remaining of the money it raised over the past year as Mr. Berry stated, it would indicate that CryoPort has spent approximately $3 million over the last 10 months, translating into a burn rate of approximately $300k per month. Not to get down to specifics without all of the information, but that would leave about 6-8 months of operating capital remaining at the implied rate. Knowing Peter personally, I feel sure that it is being handled appropriately, but I also believe that the owners of the company (both my clients and others) have a right to know how their money is being spent. Since this has not been easy to determine, it will require a little more effort.
I am not sure as to when the Annual Shareholders Meeting will be scheduled (I would expect early fall), but I would hope that management will be prepared to clearly demonstrate to the owners as to how the company is progessing. I believe that being transparent with your investors is a trademark of all successful companies. I would also hope that by the time the meeting arrives there will be some significant developments that will give everyone a positive outlook.
Closing comments from today's press release: "In closing, I would like to thank all of our shareholders for their continued support and look forward to reporting significant sales events in the not too distant future. - Peter Berry"
At this point it is about measuring the performance and to do that we need actual data and hard numbers. Hopefully we will be getting them soon. The only questions remaining are what is "significant sales" and what is "not too distant future"? As soon as these questions are answered, along with some reasonable transparency to allow investors to properly evaluate the merits of this stock, I believe that the market will begin to recognize the extraordinary value that this company has in its future.
In case you have not read it, the letter rehashed much of the same verbage from several prior press releases. Mr. Berry stated that the Company has made significant progress inroads with CRO's (Contract Research Organizations) and that the company has over $2 million in cash on hand which will be enough to support the CryoPort Express Shipper rollout, including manufacturing and recycling.
My first reaction to the shareholder letter is that there are probably not going to be many positives in the Q1 financials that are expected out later this week and this is an attempt to soften the blow.
My second reaction is that this is a method to buy time with shareholders. I understand that when dealing with large companies like FedEx or a big medical company there will be delays and this requires patience. I get that and I am remaining patient as I have been for a number of years.
These two reactions both get back to the same point: What is the point of the letter?
We know that the CryoPort Express Shipper has been completed since January 2007 ( Read January 8, 2007 Release).
We know that after receiving over $4M in net funding last fall, CryoPort started producing shippers ( Read Dec 6, 2007 Release).
We know that CryoPort is partnered up with FedEx (NYSE: FDX), (Read Dec 19, 2007 Release) so I think we can feel fairly comfortable that the product is legit.
We have known for a while that pilot programs were underway for pharmatceutical firms as of April 2007 (Read Apr 23, 2007 Release). Additionally, CryoPort started shipping stem cells for Celprogen in December 2007 (Read Dec 20, 2007 Release).
We know they were shipping internationally for Quest Diagnostics (NYSE: DGX) (Read Apr 17, 2008 Release).
We know that CryoPort received an additional $1.0625M in follow-on investment back in June 2008 (Read June 10, 2008 Release).
So where does all of this information leave investors? Well, I have a couple of items that I will be trying to answer in the near term. Since the company has received $5.0625 million in funding over the last 12 months, and according to Mr. Berry there is currently over $2 million on hand, what has been accomplished with the other roughly $3 million that has apparently been used? This company has always run on a pretty tight operational budget, so unless something has changed in the spending patterns, there should be something else that is absorbing a fair amount of cost. That should not be too hard to determine because CryoPort started manufacturing the express shippers approximately 9 months ago (see news link above). I expect to see some of that production begin to show up in the quarterly reports. If they are shipping pilot programs and manufacturing units as described in press releases and their regulatory filings, I would also expect to see some initial revenue figures begining to show up on the financial statements.
I get the impression that some investors want to see "big" results in the upcoming financials. Prior to the shareholder letter, I did not expect to see much. After the shareholder letter, I do not expect to see much. What is most important from my perspective is that the Company is moving in the right direction. If CryoPort has $2 million remaining of the money it raised over the past year as Mr. Berry stated, it would indicate that CryoPort has spent approximately $3 million over the last 10 months, translating into a burn rate of approximately $300k per month. Not to get down to specifics without all of the information, but that would leave about 6-8 months of operating capital remaining at the implied rate. Knowing Peter personally, I feel sure that it is being handled appropriately, but I also believe that the owners of the company (both my clients and others) have a right to know how their money is being spent. Since this has not been easy to determine, it will require a little more effort.
I am not sure as to when the Annual Shareholders Meeting will be scheduled (I would expect early fall), but I would hope that management will be prepared to clearly demonstrate to the owners as to how the company is progessing. I believe that being transparent with your investors is a trademark of all successful companies. I would also hope that by the time the meeting arrives there will be some significant developments that will give everyone a positive outlook.
Closing comments from today's press release: "In closing, I would like to thank all of our shareholders for their continued support and look forward to reporting significant sales events in the not too distant future. - Peter Berry"
At this point it is about measuring the performance and to do that we need actual data and hard numbers. Hopefully we will be getting them soon. The only questions remaining are what is "significant sales" and what is "not too distant future"? As soon as these questions are answered, along with some reasonable transparency to allow investors to properly evaluate the merits of this stock, I believe that the market will begin to recognize the extraordinary value that this company has in its future.
Tuesday, August 5, 2008
Multi-company update
This will just be a short update on various companies.
Phantom Fiber (OTCBB: PHFB) - Phantom Fiber is moving ahead nicely and it is somewhat perplexing as to why the stock doesn't get more support in the open market. In many cases, small/micro cap stocks are overvalued in the marketplace due to so much of the price of the stock being tied up in "potential". In my opinion, Phantom Fiber is one of the most UNDERVALUED small caps that I have come across. For example, the total float on Phantom Fiber is around 20M and they have a stock price of $0.18 with a resulting market cap of around $3.6 million. The recent deals that they have announced will result in more income over the next 12-18 months than their entire current market capitalization. My personal opinion is that the stock should be priced over $1 per share, at a minimum, but I am currently running numbers to come to my own valuation. I'll let you know when I have a better handle of the "current" value and where I think it could go.
Gateway Int'l Holdings - They filed an amended Form 10 last month. I presume that it was amended to address comments from the SEC (this is standard procedure). I have not heard anything from the company, but did notice that at a couple of brokerage firms they are now quoting an old price again, so that tells me that something is at least moving through the system. If I hear any updates, I'll pass on what I can.
CryoPort, Inc. (OTCBB: CYRX) - I am just waiting for Q1 financials. We have seen a little bit of support in the stock over the last week or two, which is a positive sign. Ludlow Capital has a very basic write-up on CryoPort and recently increased their price target to $1.50. The price target on the stock represents a nice percentage increase, but does not reflect the value in this company. If CryoPort announces that they have signed a significant deal, it will be very interesting to see the stock react. My biggest concern is that because the stock is not on a lot of radar screens, a big deal on paper will not be a "big deal" in the market. If we can get some eyes on the stock before significant news is out there, it will give positive news more impact when it materializes. Hopefully there is good news coming down the line either concurrent or before quarterly results are released.
Redux (OTC: RDXH) / Naturade (OTCBB: NRDCQ) - Not sure how this one is going to play out exactly just yet. There is still a bit of negotiating on both sides. My thoughts are currently that instead of all of the assets of Redux going over to Naturade, it is more likely just to be the business divisions that have a Nutritional & Supplements connection. Once the details are worked out, I'll post them here and also on www.firstcapitalinvestors.com.
DISCLOSURE: As to my interest in the above companies, they are as follows:
Phantom Fiber is a current client that is contracted with FCI and I have also made a personal private equity investment into the stock and on my advisory side I have a number of clients who have invested as well.
Gateway Int'l Holdings - They were a client until 12/31/07. I currently hold a large position of stock, both personally and with my client base on the advisory side.
CryoPort - They were former client that I helped bring public in March 2005 and worked with until August 2007. Currently I am an investor both personally as well as through my advisory clients. I am in contact with a large number of the outstanding shares who along with me, are waiting to see the Q1 Report to assess progress of the company.
Redux/Naturade - Both companies are current FCI clients to whom I provide consulting services. I am a large shareholder, both personally and through my advisory clients.
Phantom Fiber (OTCBB: PHFB) - Phantom Fiber is moving ahead nicely and it is somewhat perplexing as to why the stock doesn't get more support in the open market. In many cases, small/micro cap stocks are overvalued in the marketplace due to so much of the price of the stock being tied up in "potential". In my opinion, Phantom Fiber is one of the most UNDERVALUED small caps that I have come across. For example, the total float on Phantom Fiber is around 20M and they have a stock price of $0.18 with a resulting market cap of around $3.6 million. The recent deals that they have announced will result in more income over the next 12-18 months than their entire current market capitalization. My personal opinion is that the stock should be priced over $1 per share, at a minimum, but I am currently running numbers to come to my own valuation. I'll let you know when I have a better handle of the "current" value and where I think it could go.
Gateway Int'l Holdings - They filed an amended Form 10 last month. I presume that it was amended to address comments from the SEC (this is standard procedure). I have not heard anything from the company, but did notice that at a couple of brokerage firms they are now quoting an old price again, so that tells me that something is at least moving through the system. If I hear any updates, I'll pass on what I can.
CryoPort, Inc. (OTCBB: CYRX) - I am just waiting for Q1 financials. We have seen a little bit of support in the stock over the last week or two, which is a positive sign. Ludlow Capital has a very basic write-up on CryoPort and recently increased their price target to $1.50. The price target on the stock represents a nice percentage increase, but does not reflect the value in this company. If CryoPort announces that they have signed a significant deal, it will be very interesting to see the stock react. My biggest concern is that because the stock is not on a lot of radar screens, a big deal on paper will not be a "big deal" in the market. If we can get some eyes on the stock before significant news is out there, it will give positive news more impact when it materializes. Hopefully there is good news coming down the line either concurrent or before quarterly results are released.
Redux (OTC: RDXH) / Naturade (OTCBB: NRDCQ) - Not sure how this one is going to play out exactly just yet. There is still a bit of negotiating on both sides. My thoughts are currently that instead of all of the assets of Redux going over to Naturade, it is more likely just to be the business divisions that have a Nutritional & Supplements connection. Once the details are worked out, I'll post them here and also on www.firstcapitalinvestors.com.
DISCLOSURE: As to my interest in the above companies, they are as follows:
Phantom Fiber is a current client that is contracted with FCI and I have also made a personal private equity investment into the stock and on my advisory side I have a number of clients who have invested as well.
Gateway Int'l Holdings - They were a client until 12/31/07. I currently hold a large position of stock, both personally and with my client base on the advisory side.
CryoPort - They were former client that I helped bring public in March 2005 and worked with until August 2007. Currently I am an investor both personally as well as through my advisory clients. I am in contact with a large number of the outstanding shares who along with me, are waiting to see the Q1 Report to assess progress of the company.
Redux/Naturade - Both companies are current FCI clients to whom I provide consulting services. I am a large shareholder, both personally and through my advisory clients.
Tuesday, July 22, 2008
CryoPort (OTCBB: CYRX)
Today's announcement from CryoPort that it is experiencing success in its Extreme Conditions Pilot is certainly a positive sign. I am pleased that the Company is communicating the success of this program to its shareholders. I certainly hope that this will be the beginning of a much improved shareholder communications program.
I have spoken with a large number of investors over the last several weeks who contacted me to offer me their support of my last piece on CryoPort. While I am thankful for the support shown to me, please remember that I am simply an investor, like many of those reading this report. Yes, through my network of people, we control a sizable percentage of the stock and yes, I can become a catalyst for change should it become necessary. However, I do want to reiterate that I have faith in the current management and I want to see them succeed as much as anyone. Is my faith misplaced? Am I just being naive? Perhaps, but we will know more about this company in the weeks ahead.
Right now I am focused on several measures that can demonstrate to me whether my clients are being served well through their investment in CryoPort stock. With so many well known stocks selling at record low prices, I have to be assured that my clients who own CryoPort stock are in an investment that has better investment potential than other current opportunities. Otherwise, why should we own it?
I have been asked recently by investors what I am looking for from CryoPort over the remainder of the summer. The answer is three-fold: 1) Improved Shareholder Communications, 2) Improvements in Q1 Financials and 3) Some sort of contract indicating that the Company is moving in the right direction.
The communication between a company and its shareholders is a primary component of the investing process and this is an area where, in my opinion, CryoPort currently fails. I recieve about 10 calls per day asking for updates, but unfortunately I can't help. Investors tell me they can't get any current information about the company from anywhere and when they call the Company directly, they don't get any transparent answers. Not sure why people think I will have they answers they seek, since I am the most vocal critic about the lack of communication, but my line is alway open for those that might have something to say.
I have also reached out to the Company over the last year, but no one apparently wants to speak with me either. Many of you can't believe that I can't get good information, given that I helped bring this company public, represented a majority of the first year market support when the stock remained over $5 per share and have relationships extending to probably 60% or better of the current shares outstanding. Well believe it. So, if you feel like you are not getting relevant information, don't feel like you are the only one.
For a lot of small caps, the problem they have with being properly valued is due to the "product". Some grand idea evolves in someone's head and it has to be the next big thing. I call it the "prettiest baby theory". But it won't be because the product doesn't have a scalable market or maybe it is not really that good. At CryoPort, it is not that the Company doesn't have an excellent product, on the contrary, I believe it has the best product available to the global market place. And I believe that they are years ahead of anyone who might get into their space and there is very large current capacity to use the Express Shipper, providing a very significant upside in regards to investment potential.
My chief concern is that CryoPort has never exhibited the corporate mentality of telling investors why investing in CryoPort is worth taking a look at. I see the CEO's of Fortune 500 companies on CNBC and Bloomberg "pitching" their companies every single day. I think that all companies have to tell their story and I wish CryoPort would, because the only thing holding this stock back from being properly valued is a lack of investor attention. (Again, getting news in front of current investors at other companies with which CryoPort does business would go a long way towards getting CYRX on a bunch of trading screens.)
I was forwarded an email from another investor that included comments from Mr. Fine, CryoPort's IR guy, where he wrote CryoPort's Investor Relations efforts are not intended for the "retail investor", but rather that the stock was being positioned as an institutional play. Huh? This is a microcap company with a $0.75 stock price that trades $25k per day. CryoPort needs the retail investor and is relying on these individual investors to purchase stock at current levels. Many institutional investors are not able to purchase penny stock securities, of which CryoPort currently has title. (Some private groups can, but not the traditional institutional players like mutual funds, pensions, etc.) In the spring of 2007 when the stock was being featured on a couple of trading boards, we saw the power of the retail trader and the stock went to $3.50 per share, with volume improvements that are still being felt in the stock to this day. When the stock is back up to $3-$5 per share, with a reasonable amount of liquidity and when CryoPort has financial results to warrant a look from the large investor, perhaps institutions will take a closer look. But right now, it is a retail investor play and there is not a lot of disputing that.
I have had a lot of people calling me and asking me what I personally think they should do to help improve the stock price. Well first and foremost, improve communications. Investors are starving to hear results from the Company, but the only news that seems to make its way out to the public has been described to me by a number of people as "just fluff". While I don't agree that ALL of the news is fluff, particularly if you look at the big picture and look back at the progression over the past 4 years, I would have to agree that some hard numbers would be beneficial for measuring various performance levels.
Some of the questions that I have had asked of me include:
How many containers can they make each month at the Lake Forest location?
Are they actually getting paid to ship containers yet?
How many containers do they have in current inventory?
What will the price be to ship an Express Shipper?
How many containers will they need for near term demand?
... AND MANY, MANY MORE, Etc., Etc..
These are all very good and relevant questions and the type of questions that investors NEED to have answered for CryoPort to have a fair valuation. Some might ask "Why do investors need to know this?" Well, how else is an investor supposed to determine what a company is worth and whether or not they should buy, sell or hold? This company has shown that it can get invovled with some big companies (ie: Quest and FedEx as reported in public filings) but what it has yet to show the investing public is how it will translate those relationships into future earnings. And don't forget, future earnings is the dynamic on which a stock's price is based. Investors, Brokers, Fund Managers, Analyst, Advisers, etc. all want to be able to put some type of valuation on a stock before buying it. Currently with CryoPort it is simply a guess, because the needed information has not come forth. I have been in the stock long enough to know that whatever the "fair value" of the future of this company, it is a lot higher than where it currently trades. Of that I am fairly certain. But how much higher? That is what I intend to find out.
As I have said to a large number of people over the past several weeks, the 1st quarter numbers will be out in the middle of August and I think that those financials should shed some light on how CryoPort is progressing. The Company received funding the middle of last year and outfitted its manufacturing facility last fall. I think that the inventory number should be measurable on a quarter over quarter basis by now and I will also be looking for improvements in top line numbers since we have been told that they are currently shipping for paying customers.
How will these numbers shape up in the Q1 report? I don't know, but I expect that we will see improvements ... or there is something wrong.
August 2007 marks a full year since I last worked with this company in any type of consultative role. The Q1 financials will tell me a lot as to how they have progressed over that time. I have been a long time buyer in the stock and still believe that this stock has the potential to exhibit "star status". I have been asked to be patient, and I have been, and I will remain patient. However, my clients and other shareholders deserve to know how the company is progressing. Clearly defined goals and a transparent way to measure management and finacial performance are the hallmarks of all successful companies (public or private) and these goals and performance measurements should be present at CryoPort as well.
Hopefully we will hear that the pilot programs are complete and maybe a measurable contract or deal will be announced this summer. If we don't see that, I will be looking to measure the performance of multiple items upon reviewing the Q1 finanical results in August. I am hopeful that both of these aspects will be positive and that CryoPort will effecitively communicate its positive operating results to shareholders.
Good luck investing to all.
I have spoken with a large number of investors over the last several weeks who contacted me to offer me their support of my last piece on CryoPort. While I am thankful for the support shown to me, please remember that I am simply an investor, like many of those reading this report. Yes, through my network of people, we control a sizable percentage of the stock and yes, I can become a catalyst for change should it become necessary. However, I do want to reiterate that I have faith in the current management and I want to see them succeed as much as anyone. Is my faith misplaced? Am I just being naive? Perhaps, but we will know more about this company in the weeks ahead.
Right now I am focused on several measures that can demonstrate to me whether my clients are being served well through their investment in CryoPort stock. With so many well known stocks selling at record low prices, I have to be assured that my clients who own CryoPort stock are in an investment that has better investment potential than other current opportunities. Otherwise, why should we own it?
I have been asked recently by investors what I am looking for from CryoPort over the remainder of the summer. The answer is three-fold: 1) Improved Shareholder Communications, 2) Improvements in Q1 Financials and 3) Some sort of contract indicating that the Company is moving in the right direction.
The communication between a company and its shareholders is a primary component of the investing process and this is an area where, in my opinion, CryoPort currently fails. I recieve about 10 calls per day asking for updates, but unfortunately I can't help. Investors tell me they can't get any current information about the company from anywhere and when they call the Company directly, they don't get any transparent answers. Not sure why people think I will have they answers they seek, since I am the most vocal critic about the lack of communication, but my line is alway open for those that might have something to say.
I have also reached out to the Company over the last year, but no one apparently wants to speak with me either. Many of you can't believe that I can't get good information, given that I helped bring this company public, represented a majority of the first year market support when the stock remained over $5 per share and have relationships extending to probably 60% or better of the current shares outstanding. Well believe it. So, if you feel like you are not getting relevant information, don't feel like you are the only one.
For a lot of small caps, the problem they have with being properly valued is due to the "product". Some grand idea evolves in someone's head and it has to be the next big thing. I call it the "prettiest baby theory". But it won't be because the product doesn't have a scalable market or maybe it is not really that good. At CryoPort, it is not that the Company doesn't have an excellent product, on the contrary, I believe it has the best product available to the global market place. And I believe that they are years ahead of anyone who might get into their space and there is very large current capacity to use the Express Shipper, providing a very significant upside in regards to investment potential.
My chief concern is that CryoPort has never exhibited the corporate mentality of telling investors why investing in CryoPort is worth taking a look at. I see the CEO's of Fortune 500 companies on CNBC and Bloomberg "pitching" their companies every single day. I think that all companies have to tell their story and I wish CryoPort would, because the only thing holding this stock back from being properly valued is a lack of investor attention. (Again, getting news in front of current investors at other companies with which CryoPort does business would go a long way towards getting CYRX on a bunch of trading screens.)
I was forwarded an email from another investor that included comments from Mr. Fine, CryoPort's IR guy, where he wrote CryoPort's Investor Relations efforts are not intended for the "retail investor", but rather that the stock was being positioned as an institutional play. Huh? This is a microcap company with a $0.75 stock price that trades $25k per day. CryoPort needs the retail investor and is relying on these individual investors to purchase stock at current levels. Many institutional investors are not able to purchase penny stock securities, of which CryoPort currently has title. (Some private groups can, but not the traditional institutional players like mutual funds, pensions, etc.) In the spring of 2007 when the stock was being featured on a couple of trading boards, we saw the power of the retail trader and the stock went to $3.50 per share, with volume improvements that are still being felt in the stock to this day. When the stock is back up to $3-$5 per share, with a reasonable amount of liquidity and when CryoPort has financial results to warrant a look from the large investor, perhaps institutions will take a closer look. But right now, it is a retail investor play and there is not a lot of disputing that.
I have had a lot of people calling me and asking me what I personally think they should do to help improve the stock price. Well first and foremost, improve communications. Investors are starving to hear results from the Company, but the only news that seems to make its way out to the public has been described to me by a number of people as "just fluff". While I don't agree that ALL of the news is fluff, particularly if you look at the big picture and look back at the progression over the past 4 years, I would have to agree that some hard numbers would be beneficial for measuring various performance levels.
Some of the questions that I have had asked of me include:
How many containers can they make each month at the Lake Forest location?
Are they actually getting paid to ship containers yet?
How many containers do they have in current inventory?
What will the price be to ship an Express Shipper?
How many containers will they need for near term demand?
... AND MANY, MANY MORE, Etc., Etc..
These are all very good and relevant questions and the type of questions that investors NEED to have answered for CryoPort to have a fair valuation. Some might ask "Why do investors need to know this?" Well, how else is an investor supposed to determine what a company is worth and whether or not they should buy, sell or hold? This company has shown that it can get invovled with some big companies (ie: Quest and FedEx as reported in public filings) but what it has yet to show the investing public is how it will translate those relationships into future earnings. And don't forget, future earnings is the dynamic on which a stock's price is based. Investors, Brokers, Fund Managers, Analyst, Advisers, etc. all want to be able to put some type of valuation on a stock before buying it. Currently with CryoPort it is simply a guess, because the needed information has not come forth. I have been in the stock long enough to know that whatever the "fair value" of the future of this company, it is a lot higher than where it currently trades. Of that I am fairly certain. But how much higher? That is what I intend to find out.
As I have said to a large number of people over the past several weeks, the 1st quarter numbers will be out in the middle of August and I think that those financials should shed some light on how CryoPort is progressing. The Company received funding the middle of last year and outfitted its manufacturing facility last fall. I think that the inventory number should be measurable on a quarter over quarter basis by now and I will also be looking for improvements in top line numbers since we have been told that they are currently shipping for paying customers.
How will these numbers shape up in the Q1 report? I don't know, but I expect that we will see improvements ... or there is something wrong.
August 2007 marks a full year since I last worked with this company in any type of consultative role. The Q1 financials will tell me a lot as to how they have progressed over that time. I have been a long time buyer in the stock and still believe that this stock has the potential to exhibit "star status". I have been asked to be patient, and I have been, and I will remain patient. However, my clients and other shareholders deserve to know how the company is progressing. Clearly defined goals and a transparent way to measure management and finacial performance are the hallmarks of all successful companies (public or private) and these goals and performance measurements should be present at CryoPort as well.
Hopefully we will hear that the pilot programs are complete and maybe a measurable contract or deal will be announced this summer. If we don't see that, I will be looking to measure the performance of multiple items upon reviewing the Q1 finanical results in August. I am hopeful that both of these aspects will be positive and that CryoPort will effecitively communicate its positive operating results to shareholders.
Good luck investing to all.
Wednesday, July 9, 2008
CryoPort, Inc. (OTCBB: CYRX)
I have been speaking with a number of individuals trying to determine the status over at CryoPort (OTCBB: CYRX). I recently spoke with another investor who indicated that CryoPort might be close to getting an impressive deal done. There were no hard numbers in our conversation, just a couple of companies and some rough estimates thrown about. The two companies are well known and are already doing business with CryoPort - as evidenced in press releases and other publicly available information.
Based on my conversations, using a realistic, but still somewhat conservative, income model on the those estimates would mean that the stock appears to be significantly undervalued at its current level.
Given the nature of my conversation and the source of the information, I am currently optimistic that we are nearing a major milestone and one that will be positive for investors. I am not at liberty to discuss details, however, today's volume has been promising and nearly all of it is coming in at the ask. At 70 cents per share, I can't imagine who would want to sell large volumes of stock, particularly with a potential deal on the horizon, but to each his own.
A review of the recent website redesign at CryoPort (www.cryoport.com) would certainly indicate that they are not shying away from letting everyone know they are in bed with FedEx. Hopefully the next press release that comes out will have some meat on its bones and include the ticker symbol of a large public comapny so this stock will finally get the eyeballs that it so badly needs.
Over the last month, my advisory clients have been net buyers of stock. We don't really want or need to buy more stock as we already have a lot of shares. But the stock is just so attractive here, we had to pick up some. If what I am hearing comes to fruition, I would expect to see a lot of positive momentum in the stock over the near term.
How long will it take to work out the details? I don't know. I do know that a very reliable source ask me to be patient. I know over the past couple of months, I have introduced some new investors who are buying the stock, including: money managers, brokers, individual investors and even a few of the original investors in the Company are buying some additional shares. If we could just get the sellers out of the way, this stock could surge.
I am looking forward to reviewing the Q1 financials and to see what kind of quarter over quarter improvements we are getting from our management team. If I don't see a deal get announced over the next month or measurable financial and operational improvements when reviewing the last 3 quarters when the numbers come out in August, I will begin to push a platform for change. I have already spoken with a number of shareholders that represents a significant amount of stock and believe that I will have the necessary voting block to effect a change should it become necessary.
Together with my advisory clients, we maintain a sizeable ownership in this company. I hear the frustration every day in this stock that we continue to expect so much from. And while I am fully prepared to become a change agent if necessary, I am 100% hopeful that it will be a moot point and we will all be in a much happier place in 30-45 days. If what I hear is accurate, I think we will be both happier and wealthier too.
If you haven't signed up for FCI News Alerts, please go to www.firstcapitalinvestors.com and sign up. It is a free service and it is the fastest way that I have available to me to get news out to those who follow the stocks in which I have an interest. Make sure to check your email because it is a "double opt in" service, requiring you to verify that you signed up. I use this service to make sure that only those who want to recieve the news actually get my emails.
Hope you all had a Great July 4th and are experiencing a restful summer, even in these turbulent markets.
~ Peace ~
Based on my conversations, using a realistic, but still somewhat conservative, income model on the those estimates would mean that the stock appears to be significantly undervalued at its current level.
Given the nature of my conversation and the source of the information, I am currently optimistic that we are nearing a major milestone and one that will be positive for investors. I am not at liberty to discuss details, however, today's volume has been promising and nearly all of it is coming in at the ask. At 70 cents per share, I can't imagine who would want to sell large volumes of stock, particularly with a potential deal on the horizon, but to each his own.
A review of the recent website redesign at CryoPort (www.cryoport.com) would certainly indicate that they are not shying away from letting everyone know they are in bed with FedEx. Hopefully the next press release that comes out will have some meat on its bones and include the ticker symbol of a large public comapny so this stock will finally get the eyeballs that it so badly needs.
Over the last month, my advisory clients have been net buyers of stock. We don't really want or need to buy more stock as we already have a lot of shares. But the stock is just so attractive here, we had to pick up some. If what I am hearing comes to fruition, I would expect to see a lot of positive momentum in the stock over the near term.
How long will it take to work out the details? I don't know. I do know that a very reliable source ask me to be patient. I know over the past couple of months, I have introduced some new investors who are buying the stock, including: money managers, brokers, individual investors and even a few of the original investors in the Company are buying some additional shares. If we could just get the sellers out of the way, this stock could surge.
I am looking forward to reviewing the Q1 financials and to see what kind of quarter over quarter improvements we are getting from our management team. If I don't see a deal get announced over the next month or measurable financial and operational improvements when reviewing the last 3 quarters when the numbers come out in August, I will begin to push a platform for change. I have already spoken with a number of shareholders that represents a significant amount of stock and believe that I will have the necessary voting block to effect a change should it become necessary.
Together with my advisory clients, we maintain a sizeable ownership in this company. I hear the frustration every day in this stock that we continue to expect so much from. And while I am fully prepared to become a change agent if necessary, I am 100% hopeful that it will be a moot point and we will all be in a much happier place in 30-45 days. If what I hear is accurate, I think we will be both happier and wealthier too.
If you haven't signed up for FCI News Alerts, please go to www.firstcapitalinvestors.com and sign up. It is a free service and it is the fastest way that I have available to me to get news out to those who follow the stocks in which I have an interest. Make sure to check your email because it is a "double opt in" service, requiring you to verify that you signed up. I use this service to make sure that only those who want to recieve the news actually get my emails.
Hope you all had a Great July 4th and are experiencing a restful summer, even in these turbulent markets.
~ Peace ~
Wednesday, June 25, 2008
Phantom Fiber: OTCBB: PHFB
The last 2 press releases for Phantom Fiber (OTCBB: PHFB) have been very interesting to me. When I originally started looking at this company, I was under the impression that it was more of a software development company for the gaming sector. However, putting together the Investor Fact Sheet (click for PDF) and reading the last 2 press releases have really been educational for me and they demonstrated that this company is not really a "gaming play" at all. Phantom Fiber is a delivery platform for all types of software applications to mobile devices, period. Gaming is a part, and a large part right now, but I suspect that Financial will become the bread and butter over the next year or two and other applications could also become a much larger component of the picture as well.
And if the client base is an inidcation, Phantom Fiber's technology is apparently pretty good as evidenced by the fact that leading casinos, leading gaming sites and leading financial service firms are now using the platform across multiple industries.
The real question now becomes how does the company translate the ability to deliver a leading application delivery platform into a cash machine? I think that the recent announcement of FX Solutions GTS Mobile deal might shed some insight as to how Phantom Fiber will expand its profitability and do so with impressive margins.
Let's review. For the past few years, Phantom Fiber has been in more of a developmental stage. The Company identified several key components that would be required by potential customers and began creating the software that would address the most stringent requirements. From my understanding, 3 primary components, of equal importance, were addressed during the development stage:
1. Graphical interface
2. Speed
3. Security
Graphical interface that allows the mobile device user that have a near PC like experience on their mobile phone or PDA is most advanced in the gaming sector.
Speed is critical in software application delivery. Whether it is in gaming, financial services, healthcare, etc., the delivery of data at full mobile high speed is mandatory for current users.
Security is of the utmost importance in nearly all delivery applications. Of course, being involved in the financial sector, I tend to believe that the "most important" security measures deal with transactions involving the movement of money. This would include financial services and gaming programs. (I do realize that ANY and ALL data requires a 100% secure transaction, it is just that money transfer, at least to me, should be at the top of the list.)
In the gaming sector, the various game manufacturers have very sophisticated applications on casino and gaming websites. Users need to have the same functionality on their mobile devices as they are accustomed to on their personal computers. Phantom Fiber chose the gaming sector as its first market segment to target because this sector allowed Phantom Fiber to ensure that it was addressing each of the 3 major criteria (graphics, speed & security) while concentrating its marketing efforts on a targeted number of potential clients. Based on what I have read, Phantom Fiber has been successful in penetrating this market as it is the leading delivery platform in the mobile space for the Gaming Sector.
In my opinion, the announcement of GTS Mobile deal for FX Solutions is the start of the next phase at Phantom Fiber. While the gaming sector provided Phantom Fiber with the stage for developing and proving its delivery platform is the best available, I anticipate that the finacial sector will be the stage for showing the true power of Phantom Fiber from an operational and financial standpoint.
Providing the platform to banks, brokerage firms, etc. could create an income stream at Phantom Fiber that is not commonly seen at traditional software companies. Yes, Phantom Fiber will get the traditional installation fee, maintainence fees, user fees, etc. BUT, if it can also get a piece of the transaction fees that are generated as a mobile application is used - for example a fee for each stock trade that is completed at a brokerage firm - the cash flow annuity that would be developed over a growing client list could be tremendous.
When I started working on this company on June 4th 2008, the stock was bid at 16.5 cents per share. As I write this, it is currently bid at 27 cents per share. I personally think that we have only scratched the surface on what the value will be over the next couple of years. I am currently buying PHFB shares.
DISCLOSURE: Through First Capital Investors I have a contract with Phantom Fiber to provide advisory services. I receive a monthly fee for my advisory services. In my private equity holdings, I own stock and warrants in the company. Via Meehan Capital Management Group, I am currently acquiring shares in the open market for select investors of the MCMG Private Client Group.
And if the client base is an inidcation, Phantom Fiber's technology is apparently pretty good as evidenced by the fact that leading casinos, leading gaming sites and leading financial service firms are now using the platform across multiple industries.
The real question now becomes how does the company translate the ability to deliver a leading application delivery platform into a cash machine? I think that the recent announcement of FX Solutions GTS Mobile deal might shed some insight as to how Phantom Fiber will expand its profitability and do so with impressive margins.
Let's review. For the past few years, Phantom Fiber has been in more of a developmental stage. The Company identified several key components that would be required by potential customers and began creating the software that would address the most stringent requirements. From my understanding, 3 primary components, of equal importance, were addressed during the development stage:
1. Graphical interface
2. Speed
3. Security
Graphical interface that allows the mobile device user that have a near PC like experience on their mobile phone or PDA is most advanced in the gaming sector.
Speed is critical in software application delivery. Whether it is in gaming, financial services, healthcare, etc., the delivery of data at full mobile high speed is mandatory for current users.
Security is of the utmost importance in nearly all delivery applications. Of course, being involved in the financial sector, I tend to believe that the "most important" security measures deal with transactions involving the movement of money. This would include financial services and gaming programs. (I do realize that ANY and ALL data requires a 100% secure transaction, it is just that money transfer, at least to me, should be at the top of the list.)
In the gaming sector, the various game manufacturers have very sophisticated applications on casino and gaming websites. Users need to have the same functionality on their mobile devices as they are accustomed to on their personal computers. Phantom Fiber chose the gaming sector as its first market segment to target because this sector allowed Phantom Fiber to ensure that it was addressing each of the 3 major criteria (graphics, speed & security) while concentrating its marketing efforts on a targeted number of potential clients. Based on what I have read, Phantom Fiber has been successful in penetrating this market as it is the leading delivery platform in the mobile space for the Gaming Sector.
In my opinion, the announcement of GTS Mobile deal for FX Solutions is the start of the next phase at Phantom Fiber. While the gaming sector provided Phantom Fiber with the stage for developing and proving its delivery platform is the best available, I anticipate that the finacial sector will be the stage for showing the true power of Phantom Fiber from an operational and financial standpoint.
Providing the platform to banks, brokerage firms, etc. could create an income stream at Phantom Fiber that is not commonly seen at traditional software companies. Yes, Phantom Fiber will get the traditional installation fee, maintainence fees, user fees, etc. BUT, if it can also get a piece of the transaction fees that are generated as a mobile application is used - for example a fee for each stock trade that is completed at a brokerage firm - the cash flow annuity that would be developed over a growing client list could be tremendous.
When I started working on this company on June 4th 2008, the stock was bid at 16.5 cents per share. As I write this, it is currently bid at 27 cents per share. I personally think that we have only scratched the surface on what the value will be over the next couple of years. I am currently buying PHFB shares.
DISCLOSURE: Through First Capital Investors I have a contract with Phantom Fiber to provide advisory services. I receive a monthly fee for my advisory services. In my private equity holdings, I own stock and warrants in the company. Via Meehan Capital Management Group, I am currently acquiring shares in the open market for select investors of the MCMG Private Client Group.
Friday, June 6, 2008
Phantom Fiber: (OTCBB: PHFB)
I have just begun working with Phantom Fiber Corporation (OTCBB: PHFB) as their Investor Relations and Capital Markets Advisor. The Company is a software developer of applications for the mobile space. They are involved in bulding software apps for a number of industries including: Financial Services, Gaming, Medical Records, Logistics and many more.
The founder of Phantom Fiber, Jeff Halloran, is a seasoned veteran in the software space, particularly in the banking sector. was one of Larry Ellison's first employees (employee #6, I think) at Oracle (NASDAQ: ORCL) and helped to develop Oracle's international consulting business.
While completing a enterprise solution for one of the largest banks in Canada, Jeff and his team recognized a major shortfall in the way that software applications were being addressed when "real time" mobile applications were required. Mobile applications relied on a specific network carrier and had delays that were not compatible with performing transactions that need to be "real time". Phantom Fiber developed applications that solve this delay issue and work directly with the customer and their client base of users.
They have a very impressive client list and are partnered with some of the leading companies in multiple industries. They are already the dominant firm in the online gaming sector and are working diligently to become the dominant player in banking and financial services. Banking transactions, brokerage trading, currency trading, etc. etc. are all in the near term pipeline.
I have prepared an Investor Fact Sheet that is currently being reviewed by the Company and I will have it available at www.firstcapitalinvestors.com as soon as the Company's approval.
The Company has a very low number of shares outstanding with only 19M and about 70% or so of that is held by restricted insiders. Not a lot of stock in the float and I don't expect the stock to stay at its current levels for very long. Once some eyes are put on this stock, I expect that we will see a nice price appreciation.
DISCLOSURE: I have a contract with Phantom Fiber to provide advisory services. I receive a monthly fee for my advisory services and I own stock and warrants in the company as part of my compensation. I am currently acquiring shares in the open market for myself and my clients.
The founder of Phantom Fiber, Jeff Halloran, is a seasoned veteran in the software space, particularly in the banking sector. was one of Larry Ellison's first employees (employee #6, I think) at Oracle (NASDAQ: ORCL) and helped to develop Oracle's international consulting business.
While completing a enterprise solution for one of the largest banks in Canada, Jeff and his team recognized a major shortfall in the way that software applications were being addressed when "real time" mobile applications were required. Mobile applications relied on a specific network carrier and had delays that were not compatible with performing transactions that need to be "real time". Phantom Fiber developed applications that solve this delay issue and work directly with the customer and their client base of users.
They have a very impressive client list and are partnered with some of the leading companies in multiple industries. They are already the dominant firm in the online gaming sector and are working diligently to become the dominant player in banking and financial services. Banking transactions, brokerage trading, currency trading, etc. etc. are all in the near term pipeline.
I have prepared an Investor Fact Sheet that is currently being reviewed by the Company and I will have it available at www.firstcapitalinvestors.com as soon as the Company's approval.
The Company has a very low number of shares outstanding with only 19M and about 70% or so of that is held by restricted insiders. Not a lot of stock in the float and I don't expect the stock to stay at its current levels for very long. Once some eyes are put on this stock, I expect that we will see a nice price appreciation.
DISCLOSURE: I have a contract with Phantom Fiber to provide advisory services. I receive a monthly fee for my advisory services and I own stock and warrants in the company as part of my compensation. I am currently acquiring shares in the open market for myself and my clients.
Thursday, May 29, 2008
UPDATE: Gateway Int'l
I just received a call from Tim Consalvi, CEO of Gateway International Holdings, and he gave me the best news that I have had in quite a while. Gateway Int'l has filed for registration with the SEC!
To review documents or exhibits, see: SEC Form 10-12G
Tim indicated that he expects to receive comments from the SEC on a normal schedule (usually 30 days from filing) and that they will continue to move things forward as quickly as possible. The filing was submitted on May 16, 2008, so I am looking at middle of June as to the SEC comment period.
This is tremendous news for shareholders in Gateway Int'l. I repeat what I have said all along: This is a nice small cap company that continues to plug away at business. It is a bricks and mortar company made up of hardworking Americans who manufacture specialty components for large customers in aerospace, defense, automotive, medical equipment and other sectors.
My hat is off to the management team, Tim Consalvi in particular, for keeping a nose to the grindstone and making their way back. I know the people involved here and know what they have been through. I can tell all of the investors out there that they had to work hard to overcome some of the difficulties that they were presented. I look forward to the day when the company completes its registration and becomes trading again and I know there will be a smile of satisfaction for Tim and his team - one that is well deserved.
My congratulations to the management team at Gateway International Holdings!
DISCLOSURE: I worked with Gateway International Holdings for several years as their Investor Relations consultant. I am a large shareholder of their stock and have a fair amount of stock held by my clients and others throughout my network of relationships. And today is a good day. :)
To review documents or exhibits, see: SEC Form 10-12G
Tim indicated that he expects to receive comments from the SEC on a normal schedule (usually 30 days from filing) and that they will continue to move things forward as quickly as possible. The filing was submitted on May 16, 2008, so I am looking at middle of June as to the SEC comment period.
This is tremendous news for shareholders in Gateway Int'l. I repeat what I have said all along: This is a nice small cap company that continues to plug away at business. It is a bricks and mortar company made up of hardworking Americans who manufacture specialty components for large customers in aerospace, defense, automotive, medical equipment and other sectors.
My hat is off to the management team, Tim Consalvi in particular, for keeping a nose to the grindstone and making their way back. I know the people involved here and know what they have been through. I can tell all of the investors out there that they had to work hard to overcome some of the difficulties that they were presented. I look forward to the day when the company completes its registration and becomes trading again and I know there will be a smile of satisfaction for Tim and his team - one that is well deserved.
My congratulations to the management team at Gateway International Holdings!
DISCLOSURE: I worked with Gateway International Holdings for several years as their Investor Relations consultant. I am a large shareholder of their stock and have a fair amount of stock held by my clients and others throughout my network of relationships. And today is a good day. :)
Wednesday, May 21, 2008
OTCPK: OPRX (OPTIMIZERx)
OPTIMIZERx (OTCPK: OPRX) is one of the new companies that I have just begun working with and it is indeed an interesting story. This company just began trading publicly this month. The float is VERY tight and insiders control over 70% of the company. I don't expect a high volume of trading due to a $4 stock price and only about a 1.2M shares in the float, but as buyers come in and liquidity improves, I expect that the price will move a bit higher and upon completion of their financial audits and meeting listing criteria, I would think they would seek to move up to NASDAQ.
Basically, OPTIMIZERx, via its website www.optimizerx.com, provides an efficient platform for drug companies to reach potential patients. OPTIMIZERx builds out the virtual marketing and sales platform, Big Pharma pays to advertise, provide offers, discounts, trials, etc. via this platform and patients use the website to find the offers and save money.
In my opinion, a very big "key to success" for this company will be if they can attratct enough visitors to the site and get them to sign up. The internet has become a tool for many people regarding medical care these days and there are several very large networks that may be able to drive traffic. If OPTIMIZERx is able to partner up with some of these networks, in an effort to get a captive audience for their services, they could really do well and their margins would make many other companies envious.
Accelerating the network growth of OPTIMIZERx users is what allows the Company to generate revenues. For the majority of its sales, OPTIMIZERx utilizes the large advertising budget of Big Pharma and sells them space throughout the website and gets paid by the drug companies for patient referals.
The management team is a group of seasoned guys that have been in the industry for a long time. They understand that increasing their network is the primary goal to increasing the amount of users that utilize the service and therefore pay the bills.
There are several television interviews from a series that CBS did on this very subject. You can review them at the newly redesigned First Capital Investor website.
The initial Investor Fact Sheet is available for DOWNLOAD as well. As more material becomes available, I will be expanding the scope of the Investor Fact Sheet, but I wanted to have something up there for initial interest.
Keep an eye on this one, it could get interesting.
DISCLAIMER: First Capital Investors is handling Investor Relations for OPTIMIZERx and has agreed to a 1-year contract for 25,000 restricted shares.
Basically, OPTIMIZERx, via its website www.optimizerx.com, provides an efficient platform for drug companies to reach potential patients. OPTIMIZERx builds out the virtual marketing and sales platform, Big Pharma pays to advertise, provide offers, discounts, trials, etc. via this platform and patients use the website to find the offers and save money.
In my opinion, a very big "key to success" for this company will be if they can attratct enough visitors to the site and get them to sign up. The internet has become a tool for many people regarding medical care these days and there are several very large networks that may be able to drive traffic. If OPTIMIZERx is able to partner up with some of these networks, in an effort to get a captive audience for their services, they could really do well and their margins would make many other companies envious.
Accelerating the network growth of OPTIMIZERx users is what allows the Company to generate revenues. For the majority of its sales, OPTIMIZERx utilizes the large advertising budget of Big Pharma and sells them space throughout the website and gets paid by the drug companies for patient referals.
The management team is a group of seasoned guys that have been in the industry for a long time. They understand that increasing their network is the primary goal to increasing the amount of users that utilize the service and therefore pay the bills.
There are several television interviews from a series that CBS did on this very subject. You can review them at the newly redesigned First Capital Investor website.
The initial Investor Fact Sheet is available for DOWNLOAD as well. As more material becomes available, I will be expanding the scope of the Investor Fact Sheet, but I wanted to have something up there for initial interest.
Keep an eye on this one, it could get interesting.
DISCLAIMER: First Capital Investors is handling Investor Relations for OPTIMIZERx and has agreed to a 1-year contract for 25,000 restricted shares.
Monday, May 19, 2008
New FCI website coming soon!
I will be introducing a newly designed website in the next few days. When the new site goes active, I will be introducing 2 new clients. The site will have a couple of new features, including Live IR, so investors can direct questions to the FCI investor relations team throughout the day. I will try to answer them as best I can, as long as a team member is in front of the computer that runs the software.
I am also going to start putting a few more resources on the site for investors, such as newsletters and additional small cap analysts. If you know of a worthy newsletter or analyst, please have them contact my office to discuss inclusion on the site.
If you have not signed up for FCI News Alerts, send an email to optin2@firstcapitalinvestors.com and put Subscribe in the subject line. (The new site has a quick sign up built into it.) The service is free and I promise you won't be bombarded with daily emails. I personally prepare and send each email out when a client releases news or there is a notable development, so you only get emails from me that are actually of relevance.
Some updates on existing interests that have been discussed on this blog:
CryoPort - Nothing new to report. All indications are that the pilot programs are moving ahead, but they just take time. Word is that FedEx and the labs/biotechs are VERY pleased with the results thus far. I still believe that we probably won't hear anything worth writing home about until a deal is signed. Then, the real catalyst will likely be when we see an outsourced manufacturing program become public. The current facility can produce a few thousand units per month, which CryoPort is already using, but that is not what is going to make this company go to the next level. It will take a big facility to make the number of containers that I expect will be needed in the not to distant future, so that continues to be my focus.
Redux/Naturade - I am hearing that the deal should close by the end of May and that the companies are moving forward with getting all of the transaction details complete. The previously announced 1 for 6 reverse stock split should be implemented at the same time as the name changes and new symbols are issues. I am hopeful to see the final approvals this week so we can all know what the final distribution ratios will be.
Gateway International - Nothing new for the most part, just a time to exercise patience. Spoke with someone who would know and he indicated they are moving ahead and hope to refile a 10SB soon. When this company starts trading again, I am hoping that it will be trading with a trailing profit. It might not be based on "non-cash" items, but from my understanding, they are running at a healthy pace on operations. So even though they are a small cap, they are cash flow positive. The Eran Engineering subsidiary in the Precision Manufacturing Group seems to be accelerating, which should continue to improve operating margins and flow straight to the bottom line.
That's all for now. Stay tuned for the new site.
I am also going to start putting a few more resources on the site for investors, such as newsletters and additional small cap analysts. If you know of a worthy newsletter or analyst, please have them contact my office to discuss inclusion on the site.
If you have not signed up for FCI News Alerts, send an email to optin2@firstcapitalinvestors.com and put Subscribe in the subject line. (The new site has a quick sign up built into it.) The service is free and I promise you won't be bombarded with daily emails. I personally prepare and send each email out when a client releases news or there is a notable development, so you only get emails from me that are actually of relevance.
Some updates on existing interests that have been discussed on this blog:
CryoPort - Nothing new to report. All indications are that the pilot programs are moving ahead, but they just take time. Word is that FedEx and the labs/biotechs are VERY pleased with the results thus far. I still believe that we probably won't hear anything worth writing home about until a deal is signed. Then, the real catalyst will likely be when we see an outsourced manufacturing program become public. The current facility can produce a few thousand units per month, which CryoPort is already using, but that is not what is going to make this company go to the next level. It will take a big facility to make the number of containers that I expect will be needed in the not to distant future, so that continues to be my focus.
Redux/Naturade - I am hearing that the deal should close by the end of May and that the companies are moving forward with getting all of the transaction details complete. The previously announced 1 for 6 reverse stock split should be implemented at the same time as the name changes and new symbols are issues. I am hopeful to see the final approvals this week so we can all know what the final distribution ratios will be.
Gateway International - Nothing new for the most part, just a time to exercise patience. Spoke with someone who would know and he indicated they are moving ahead and hope to refile a 10SB soon. When this company starts trading again, I am hoping that it will be trading with a trailing profit. It might not be based on "non-cash" items, but from my understanding, they are running at a healthy pace on operations. So even though they are a small cap, they are cash flow positive. The Eran Engineering subsidiary in the Precision Manufacturing Group seems to be accelerating, which should continue to improve operating margins and flow straight to the bottom line.
That's all for now. Stay tuned for the new site.
Tuesday, May 6, 2008
Recession or Not, Small Caps Offer Upside
I receive a fair amount of commentary across my desk and computer with the various pundits pounding their chest as to what investment is best, what is the safest, what is defensive, etc. etc. etc.
I was reading a report today sent to me from Advisor Perspectives that back tested the last 4 recessions and how the common safety flight to "big caps" was not quite as effective as it is cracked up to be.
Advisors Perspectives: Questioning the Flight To Safety
This analysis shows that during tough times, some companies will get hurt, some will simply survive and that others will excel. The important aspect though is that on an overall basis, the true winners coming out of recession periods are the small caps that have good management teams who demonstrate the ability to be flexible.
This is exactly the situation that I discussed in the First Capital Investors, Q1 2008 edition of "The Small Cap Investor" when I featured Redux Holdings (OTC: RDXH).
At the present moment, I am unsure of what the final distribution of Naturade shares will be to Redux shareholders once the Redux assets are sold to Naturade, so there is some uncertainty there. However, once the full deal is announced, Redux definitely offers a reasonable option to small cap investors who want a company that maintains diversification, defensive positioning, downside protection, experienced management combined with a stock with upside potential.
Disclaimer: I own a lot of stock in Redux and I handle IR and Capital Markets issues for the Company for compensation. I have owned the vast majority of my shares for several years. The stock does not trade very much and I think the stock is currently "off the radar". Upon completion of the transaction with Naturade, the stock should start to see some attention as there are a number of firms that have indicated an interest, but who are just waiting for the full deal to be announced and close.
Stay tuned.
I was reading a report today sent to me from Advisor Perspectives that back tested the last 4 recessions and how the common safety flight to "big caps" was not quite as effective as it is cracked up to be.
Advisors Perspectives: Questioning the Flight To Safety
This analysis shows that during tough times, some companies will get hurt, some will simply survive and that others will excel. The important aspect though is that on an overall basis, the true winners coming out of recession periods are the small caps that have good management teams who demonstrate the ability to be flexible.
This is exactly the situation that I discussed in the First Capital Investors, Q1 2008 edition of "The Small Cap Investor" when I featured Redux Holdings (OTC: RDXH).
At the present moment, I am unsure of what the final distribution of Naturade shares will be to Redux shareholders once the Redux assets are sold to Naturade, so there is some uncertainty there. However, once the full deal is announced, Redux definitely offers a reasonable option to small cap investors who want a company that maintains diversification, defensive positioning, downside protection, experienced management combined with a stock with upside potential.
Disclaimer: I own a lot of stock in Redux and I handle IR and Capital Markets issues for the Company for compensation. I have owned the vast majority of my shares for several years. The stock does not trade very much and I think the stock is currently "off the radar". Upon completion of the transaction with Naturade, the stock should start to see some attention as there are a number of firms that have indicated an interest, but who are just waiting for the full deal to be announced and close.
Stay tuned.
Monday, April 21, 2008
Update: CryoPort (OTCBB: CYRX)
For the past couple of years I have been hearing that CryoPort (OTCBB: CYRX) is not a "real" company because they don't have significant revenues. Well to those people I would say that no R&D company has significant revenues ... its part of being an R&D company. But those doubters can no longer (at least with an ounce of credibility) say that CryoPort is not the real deal.
Today's news on CryoPort validates a lot of what has been discussed about this company over the past couple of years. The primary issue facing CYRX is getting the story in front of people. I am not quite sure what CarpeDM is actually doing. I am fairly confident that they are not an IR firm and they don't seem to be much of a PR firm either. Anyone in this business should absolutely know that this type of news needs to include trading symbols in the release. Today it was Federal Express (NYSE: FDX) that was not included and it is the same problem that we had last week with the Quest Diagnostics (NYSE: DGX) release.
April 21, 2008: Federal Express Release
April 17, 2008: Quest Diagnostics Release
Here is the rub. Let's say that there are 500 people that are currently watching CryoPort very closely. They buy when the stock price dips, they read the news, etc. etc. When news like these 2 releases becomes public, this information needs to be in front of A LOT of investors, both retail and institutional. However, by only including the CYRX trading symbol in the releases, no new investors are hearing about the company. It is only being discussed by the investors who already know about the stock, and most of them already own it. Had the ticker symbols for FedEx and Quest been included into the last two releases, CYRX would have been in front of hundreds of thousands, if not millions, of new investors. When good news on a lightly followed stock is seen by hundreds of thousands of new investors, the typical follow through is NOT what we saw over the last couple of days.
Why is this so hard to figure out? An investor who communicates with me regularly recently contacted Stuart Fine at CarpeDM and was told that the newswires are the ones to call and confirm whether it is okay to include another company's symbol in the release and he didn't want to delay the news because they weren't sure how long it might take to get an answer.
First, the newswires only call if the other company's ticker symbol is actually put in the release when it is submitted. Second, if you don't ask for permission to include their trading symbol in the release that they have already approved, you can be assured that you are not going to get it. Rest assured that FedEx and Quest approved their company's name to be included in the headline of the release. As such, I seriously doubt they would object to including the ticker symbol in the body. This news is positive news for their companies (FedEx & Quest) and every public company likes positive press.
Note to Stuart Fine ... Unless you have a better way to get 1,000,000 new investors to read your press releases, how about let's at least ask if we can put the ticker in there. I don't care if it takes an extra week to get the approval, the type of exposure that the last two releases could have generated can simply not be purchased through promotional campaigns or marketing of any kind or any budget.
Okay, enough of that. Here is the facts that we know. They are partnered up with FedEx. They are shipping samples all over the globe for Quest Diagnostics. I have discussed that there has been a world class manufacturer at play here for a long time (going on 2 years now) and they want to get a piece in a big way - a million square feet facility. Does anyone think that this manufacturer is going to drop a couple hundred million to ramp up a facility of this size if there is not going to be a HUGE amount of volume being demanded?
When CryoPort will finalize that deal, I am not sure. I can tell you this though, I own a lot of stock and I am NOT SELLING A SINGLE SHARE.
You want to own "the next Microsoft" ... well, here is your chance. All of the forces that are out there are trying to keep this company out of the spotlight ... in a short time, they won't be able to.
DISCLOSURE: I worked with CryoPort from late 2004 thru August 2007. I assisted them in the process of becoming a public company in 2005 and I am pretty comfortable with the story. On my private equity side, both my clients, and myself personally, own stock in CryoPort and I also personally own some warrants. For the record, I am not consulting to them at this time and have not personally spoken with anyone in management about the status or operations of the company since the fall of 2007.
Today's news on CryoPort validates a lot of what has been discussed about this company over the past couple of years. The primary issue facing CYRX is getting the story in front of people. I am not quite sure what CarpeDM is actually doing. I am fairly confident that they are not an IR firm and they don't seem to be much of a PR firm either. Anyone in this business should absolutely know that this type of news needs to include trading symbols in the release. Today it was Federal Express (NYSE: FDX) that was not included and it is the same problem that we had last week with the Quest Diagnostics (NYSE: DGX) release.
April 21, 2008: Federal Express Release
April 17, 2008: Quest Diagnostics Release
Here is the rub. Let's say that there are 500 people that are currently watching CryoPort very closely. They buy when the stock price dips, they read the news, etc. etc. When news like these 2 releases becomes public, this information needs to be in front of A LOT of investors, both retail and institutional. However, by only including the CYRX trading symbol in the releases, no new investors are hearing about the company. It is only being discussed by the investors who already know about the stock, and most of them already own it. Had the ticker symbols for FedEx and Quest been included into the last two releases, CYRX would have been in front of hundreds of thousands, if not millions, of new investors. When good news on a lightly followed stock is seen by hundreds of thousands of new investors, the typical follow through is NOT what we saw over the last couple of days.
Why is this so hard to figure out? An investor who communicates with me regularly recently contacted Stuart Fine at CarpeDM and was told that the newswires are the ones to call and confirm whether it is okay to include another company's symbol in the release and he didn't want to delay the news because they weren't sure how long it might take to get an answer.
First, the newswires only call if the other company's ticker symbol is actually put in the release when it is submitted. Second, if you don't ask for permission to include their trading symbol in the release that they have already approved, you can be assured that you are not going to get it. Rest assured that FedEx and Quest approved their company's name to be included in the headline of the release. As such, I seriously doubt they would object to including the ticker symbol in the body. This news is positive news for their companies (FedEx & Quest) and every public company likes positive press.
Note to Stuart Fine ... Unless you have a better way to get 1,000,000 new investors to read your press releases, how about let's at least ask if we can put the ticker in there. I don't care if it takes an extra week to get the approval, the type of exposure that the last two releases could have generated can simply not be purchased through promotional campaigns or marketing of any kind or any budget.
Okay, enough of that. Here is the facts that we know. They are partnered up with FedEx. They are shipping samples all over the globe for Quest Diagnostics. I have discussed that there has been a world class manufacturer at play here for a long time (going on 2 years now) and they want to get a piece in a big way - a million square feet facility. Does anyone think that this manufacturer is going to drop a couple hundred million to ramp up a facility of this size if there is not going to be a HUGE amount of volume being demanded?
When CryoPort will finalize that deal, I am not sure. I can tell you this though, I own a lot of stock and I am NOT SELLING A SINGLE SHARE.
You want to own "the next Microsoft" ... well, here is your chance. All of the forces that are out there are trying to keep this company out of the spotlight ... in a short time, they won't be able to.
DISCLOSURE: I worked with CryoPort from late 2004 thru August 2007. I assisted them in the process of becoming a public company in 2005 and I am pretty comfortable with the story. On my private equity side, both my clients, and myself personally, own stock in CryoPort and I also personally own some warrants. For the record, I am not consulting to them at this time and have not personally spoken with anyone in management about the status or operations of the company since the fall of 2007.
Friday, April 18, 2008
Update - OTCBB: CYRX (CryoPort)
Well, we are starting to see a dribbling out of news. Some of the news has been good, but some of it has been nothing short of amatuerish.
First, let's get the bad out of the way. The My Wallst page is nothing short of really bad. Really, really bad. NO public company should result to such low end tactics. I don't know who was responsible for this very poor move, but I would NEVER, EVER allow a client of mine to do such a ridiculous thing. Totally amatuerish and probably one of the absolute worst investor relations tools that I have ever witnessed.
The second set of less than stellar work that they did was not to include a ticker of Quest Diagnostics (NYSE: DGX) in their recent press releases. With the conservative stance that CryoPort has taken to date, it is obvious Quest Diagnostics is on board and I would bet that they even reviewed and approved the press release that included the Quest name in the header of the release. However, CryoPort lost a HUGE opportunity to get their stock in front of several hundred thousand investors by not including the Quest ticker in the release. If the Quest ticker is in the release, everyone who pulls up a quote for DGX would see the CryoPort news. While this requires the approval of Quest, I have confidence that this release received Quest's approval and I think it was just a poor job of public relations for not putting the ticker into the release. Period. End of story.
Now that I have aired what I think was done incorrectly, and those items are not insignificant, let's discuss what is going on that is good.
First, based on the recent release about Quest, I believe that my information has been confirmed and that the program described in a prior post was accurate. In a recent audio interview, the monologue that Peter Berry read to us included the term "partner with FedEx". This is the first time I have heard the company use the word "partnership" instead of "we will be shipping through FedEx". I was glad to hear Mr. Berry say "partner" because since the very beginning of the relationship, that has been the intention. I am also hearing word that the new partner site for FedEx clients to ship via CryoPort Express shippers will be up and running in the very near future. Possibly before the end of April, but I will be happy with May.
The next important piece of news that I am waiting on for confirmation of the various rumors out there is to hear that large-scale manufacturing has begun. When that occurs, the game is on. I heard a long time ago that the manufacturing firm was commiting A MILLION square feet. That seems to have been what a few others have heard as well. A million square feet is a lot of space and provides the location to produce several million shippers per month. At that rate, the numbers get VERY large.
Many people think that I am crazy when I start discussing CryoPort. "Trey has been drinking the CryoPort koolaid!" Well, maybe ... BUT, when this stock demonstrates that the company can ship a hundred million shippers each year around the globe, I think I'll trade in my koolaid for a Corona on the beach.
I don't want to wear this subject out as it will take its time to develop. The program is simply too big to just "turn on overnight". Big players involved. Legal teams to deal with at multiple Fortune 500 Companies.
If I get some helpful information in the interim, I'll keep you posted. Out.
DISCLOSURE: I worked with CryoPort from late 2004 thru August 2007. I assisted them in the process of becoming a public company in 2005 and I am pretty comfortable with the story. On my private equity side, both my clients, and myself personally, own stock in CryoPort and I also personally own some warrants. For the record, I am not consulting to them at this time and have not personally spoken with management about the status or operations of the company since the fall of 2007.
First, let's get the bad out of the way. The My Wallst page is nothing short of really bad. Really, really bad. NO public company should result to such low end tactics. I don't know who was responsible for this very poor move, but I would NEVER, EVER allow a client of mine to do such a ridiculous thing. Totally amatuerish and probably one of the absolute worst investor relations tools that I have ever witnessed.
The second set of less than stellar work that they did was not to include a ticker of Quest Diagnostics (NYSE: DGX) in their recent press releases. With the conservative stance that CryoPort has taken to date, it is obvious Quest Diagnostics is on board and I would bet that they even reviewed and approved the press release that included the Quest name in the header of the release. However, CryoPort lost a HUGE opportunity to get their stock in front of several hundred thousand investors by not including the Quest ticker in the release. If the Quest ticker is in the release, everyone who pulls up a quote for DGX would see the CryoPort news. While this requires the approval of Quest, I have confidence that this release received Quest's approval and I think it was just a poor job of public relations for not putting the ticker into the release. Period. End of story.
Now that I have aired what I think was done incorrectly, and those items are not insignificant, let's discuss what is going on that is good.
First, based on the recent release about Quest, I believe that my information has been confirmed and that the program described in a prior post was accurate. In a recent audio interview, the monologue that Peter Berry read to us included the term "partner with FedEx". This is the first time I have heard the company use the word "partnership" instead of "we will be shipping through FedEx". I was glad to hear Mr. Berry say "partner" because since the very beginning of the relationship, that has been the intention. I am also hearing word that the new partner site for FedEx clients to ship via CryoPort Express shippers will be up and running in the very near future. Possibly before the end of April, but I will be happy with May.
The next important piece of news that I am waiting on for confirmation of the various rumors out there is to hear that large-scale manufacturing has begun. When that occurs, the game is on. I heard a long time ago that the manufacturing firm was commiting A MILLION square feet. That seems to have been what a few others have heard as well. A million square feet is a lot of space and provides the location to produce several million shippers per month. At that rate, the numbers get VERY large.
Many people think that I am crazy when I start discussing CryoPort. "Trey has been drinking the CryoPort koolaid!" Well, maybe ... BUT, when this stock demonstrates that the company can ship a hundred million shippers each year around the globe, I think I'll trade in my koolaid for a Corona on the beach.
I don't want to wear this subject out as it will take its time to develop. The program is simply too big to just "turn on overnight". Big players involved. Legal teams to deal with at multiple Fortune 500 Companies.
If I get some helpful information in the interim, I'll keep you posted. Out.
DISCLOSURE: I worked with CryoPort from late 2004 thru August 2007. I assisted them in the process of becoming a public company in 2005 and I am pretty comfortable with the story. On my private equity side, both my clients, and myself personally, own stock in CryoPort and I also personally own some warrants. For the record, I am not consulting to them at this time and have not personally spoken with management about the status or operations of the company since the fall of 2007.
Wednesday, April 2, 2008
OTCBB: CYRX (CryoPort)
So the news is finally out about CryoPort starting "a pilot shipping program for a leading global diagnostic testing company". After a healthy delay, I presume not entirely at the desire of CryoPort, the news comes forth. Now for those who closely monitor CryoPort, this news is both long awaited, but somewhat anticlimactic.
What most of the investors that I have spoken with really want to know is "WHO" are the companies that CryoPort is doing business with? It is nice to say "a leading shipping company" (we learned later that it was FedEx), or a "leading global diagnostic testing company" (we learned later that it is ... ? )
There are posters on message boards that have thrown the name Quest Diagnositcs (NYSE: DGX) out there as a possible user of the CryoPort Express. Actually, I have also heard that name on several occassions, so in my opinion, where there is smoke, there might be fire. Hopefully the details will be forthcoming so we can know for sure.
In an effort to get ahead of the game, I have spoken with a number of people regarding Quest Diagnostics to try and determine a ballpark figure for the number of shipments that they are actually shipping. In my research, I have received similar numbers from two different sources that I believe to be reliable. From one source I heard an amount of "90,000 shipments every day of the year". From the other source, "over 32 million shipments per year". (For the math challenged out there, 90,000 x 365 = 32,850,000. So the numbers seem to be in line with each other.) Neither of these figures came to me directly from either company, so I have to keep some measure of doubt in there for now.
I have also heard, regardless of who the client is, that CryoPort will be controlling the entire process in this relationship. I have no idea as to how much of the 32 million shipments will eventually go through CryoPort, but I have "heard" (not confirmed by either company) that Quest would like move a large percentage of its shipping to the new shipping method if the pilot programs are successful. Now that might just be wishful thinking, but, if the other rumors out there on various sites and boards are accurate regarding the "million square foot European manufacturing facility", I would have to come to the conclusion that whatever the amount is, it is a LOT.
In my opinion, CryoPort is at the edge of something very big. There are not too many opportunities in an investor's lifetime to get into a company that can truly revolutionize an industry. Those types of opportunities are genuinely unique and make a difference in people's lives not just for a few years, but for generations to follow.
I think that we just might have one of those opportunities here with CryoPort.
DISCLOSURE: I worked with CryoPort from late 2004 thru August 2007. I assisted them in the process of becoming a public company in 2005 and I am pretty comfortable with the story. On my private equity side, both my clients, and myself personally, own stock in CryoPort and I also personally own some warrants. For the record, I am not consulting to them at this time and have not personally spoken with management about the status or operations of the company since the fall of 2007.
What most of the investors that I have spoken with really want to know is "WHO" are the companies that CryoPort is doing business with? It is nice to say "a leading shipping company" (we learned later that it was FedEx), or a "leading global diagnostic testing company" (we learned later that it is ... ? )
There are posters on message boards that have thrown the name Quest Diagnositcs (NYSE: DGX) out there as a possible user of the CryoPort Express. Actually, I have also heard that name on several occassions, so in my opinion, where there is smoke, there might be fire. Hopefully the details will be forthcoming so we can know for sure.
In an effort to get ahead of the game, I have spoken with a number of people regarding Quest Diagnostics to try and determine a ballpark figure for the number of shipments that they are actually shipping. In my research, I have received similar numbers from two different sources that I believe to be reliable. From one source I heard an amount of "90,000 shipments every day of the year". From the other source, "over 32 million shipments per year". (For the math challenged out there, 90,000 x 365 = 32,850,000. So the numbers seem to be in line with each other.) Neither of these figures came to me directly from either company, so I have to keep some measure of doubt in there for now.
I have also heard, regardless of who the client is, that CryoPort will be controlling the entire process in this relationship. I have no idea as to how much of the 32 million shipments will eventually go through CryoPort, but I have "heard" (not confirmed by either company) that Quest would like move a large percentage of its shipping to the new shipping method if the pilot programs are successful. Now that might just be wishful thinking, but, if the other rumors out there on various sites and boards are accurate regarding the "million square foot European manufacturing facility", I would have to come to the conclusion that whatever the amount is, it is a LOT.
In my opinion, CryoPort is at the edge of something very big. There are not too many opportunities in an investor's lifetime to get into a company that can truly revolutionize an industry. Those types of opportunities are genuinely unique and make a difference in people's lives not just for a few years, but for generations to follow.
I think that we just might have one of those opportunities here with CryoPort.
DISCLOSURE: I worked with CryoPort from late 2004 thru August 2007. I assisted them in the process of becoming a public company in 2005 and I am pretty comfortable with the story. On my private equity side, both my clients, and myself personally, own stock in CryoPort and I also personally own some warrants. For the record, I am not consulting to them at this time and have not personally spoken with management about the status or operations of the company since the fall of 2007.
Monday, March 24, 2008
What's in a deal? (OTCBB: NRDCQ / OTCPK: RDXH)
So Naturade is going to acquire all the assets and operations of Redux?
But Redux owns Naturade ... what is the purpose of this deal?
Redux has about 32.6 million total shares outstanding. Naturade, once the 1-for-6 reverse split is complete, will have about 32.8 million total shares outstanding. Redux owns about 30.2 of the 32.8 million shares in Naturade. When the assets go over to Naturade, Naturade will give shares of restricted stock to Redux as compensation. Once the restriction can be lifted from those shares (I expect it will be about 6 months), they will be distributed to Redux shareholders. Once the deal is complete, Naturade will be renamed "Redux Holdings" and Redux will become something else.
In a nutshell here is what I perceive as happening. For each share of RDXH that we own, we will receive 0.9251 shares of NRDCQ when it is distributed. Additionally, we will continue to own the existing shares of RDXH (and some additional shares of NRDCQ that are held there). I expect that NRDCQ will become competively priced with the current price of RDXH, split adjusted. Once they are roughly equivalents, they should theoretically "trade together" until the assets are over and the shares have been distributed.
Once all of the assets are distributed, the only thing left in Redux will be the NRDCQ restricted shares. Once those shares are distributed in about 6 months (my guess) then the current Redux corporate structure could be used for another company to become public as it will no longer have any assets.
Why do all of this? Well, here is my thoughts. Naturade has just been through bankruptcy and everything there is looking very bright as they have a cleaned up set of financials and they are profitable. Additionally, Naturade is a reporting company trading on the OTCBB. This method provides a swift move for Redux to become a reporting company to the SEC and get all of the corporate assets trading under a single public platform.
For me, as soon as NRDCQ (split adjusted) is within 15% of the value of RDXH, I like RDXH as the investment. Investors in RDXH will receive 0.9251 shares of NRDCQ, with some additional shares to follow when the restriction is lifted. Additionally, it provides a bit of "free diversification" opportunity as the remainder shares of RDXH will most likely be used in a future deal once the NRDCQ restricted shares have been distributed.
I am glad to see that Naturade is doing well. I am also glad to see that Redux Holdings is back on the warpath for acquistions. When I listen to Adam Michelin's interview at CEO Cast (March 24, 2008) I get the idea that Adam is working on some other deals.
I handle IR and Capital Markets Advisory issues for Redux Holdings and they recently authorized an updated Investor Brochure. In this document, Adam discusses a new acquistion target identified only as "Target R". This future component of Redux nearly doubles the top line revenue figure and is right in line of where Adam has historically called his "sweet spot" for deal flow ... companies with revenues in the $30-$50 million range.
Should be interesting to see what happens here as new investors become aware of these stocks. In my opinion, things are certainly pointing in the right direction.
DISCLOSURE: I am a large holder of Redux stock as I assisted Redux in becoming a public entity back in 2006. I continue to work with the Company on IR and Capital Markets Advisory issues and receive compensation for my services.
But Redux owns Naturade ... what is the purpose of this deal?
Redux has about 32.6 million total shares outstanding. Naturade, once the 1-for-6 reverse split is complete, will have about 32.8 million total shares outstanding. Redux owns about 30.2 of the 32.8 million shares in Naturade. When the assets go over to Naturade, Naturade will give shares of restricted stock to Redux as compensation. Once the restriction can be lifted from those shares (I expect it will be about 6 months), they will be distributed to Redux shareholders. Once the deal is complete, Naturade will be renamed "Redux Holdings" and Redux will become something else.
In a nutshell here is what I perceive as happening. For each share of RDXH that we own, we will receive 0.9251 shares of NRDCQ when it is distributed. Additionally, we will continue to own the existing shares of RDXH (and some additional shares of NRDCQ that are held there). I expect that NRDCQ will become competively priced with the current price of RDXH, split adjusted. Once they are roughly equivalents, they should theoretically "trade together" until the assets are over and the shares have been distributed.
Once all of the assets are distributed, the only thing left in Redux will be the NRDCQ restricted shares. Once those shares are distributed in about 6 months (my guess) then the current Redux corporate structure could be used for another company to become public as it will no longer have any assets.
Why do all of this? Well, here is my thoughts. Naturade has just been through bankruptcy and everything there is looking very bright as they have a cleaned up set of financials and they are profitable. Additionally, Naturade is a reporting company trading on the OTCBB. This method provides a swift move for Redux to become a reporting company to the SEC and get all of the corporate assets trading under a single public platform.
For me, as soon as NRDCQ (split adjusted) is within 15% of the value of RDXH, I like RDXH as the investment. Investors in RDXH will receive 0.9251 shares of NRDCQ, with some additional shares to follow when the restriction is lifted. Additionally, it provides a bit of "free diversification" opportunity as the remainder shares of RDXH will most likely be used in a future deal once the NRDCQ restricted shares have been distributed.
I am glad to see that Naturade is doing well. I am also glad to see that Redux Holdings is back on the warpath for acquistions. When I listen to Adam Michelin's interview at CEO Cast (March 24, 2008) I get the idea that Adam is working on some other deals.
I handle IR and Capital Markets Advisory issues for Redux Holdings and they recently authorized an updated Investor Brochure. In this document, Adam discusses a new acquistion target identified only as "Target R". This future component of Redux nearly doubles the top line revenue figure and is right in line of where Adam has historically called his "sweet spot" for deal flow ... companies with revenues in the $30-$50 million range.
Should be interesting to see what happens here as new investors become aware of these stocks. In my opinion, things are certainly pointing in the right direction.
DISCLOSURE: I am a large holder of Redux stock as I assisted Redux in becoming a public entity back in 2006. I continue to work with the Company on IR and Capital Markets Advisory issues and receive compensation for my services.
Friday, March 14, 2008
GWYI - Update
I recently spoke with Tim Consalvi over at Gateway International. Tim just released a letter to shareholders and posted it on their new corporate website. I have reposted the release on my First Capital Investors site as well for your review.
Tim has assured me that they are moving forward in their efforts re-file a Form 10SB with the SEC. While I don't think that the company is going to put a specific date out there for investors to look ahead to, based on the general tone of our conversation, I am "hopeful" that we will see a filing sooner than later, perhaps even by this summer. Gateway operates on a June 30 year end, so perhaps that will have an influence, although I am unsure at this juncture.
A Form 10SB filing would be a welcomed relief and I believe that the guys over at Gateway are genuinely good guys and are trying to do what is right by the shareholders. Tim assured me that he is pressing forward. Having had many face to face meetings with Tim, I believe him.
According to the new Gateway website, http://www.gih-inc.com/, Steve Kasprisin, is apparently still a Director with Gateway, so perhaps there is more to that story than I am aware of. Either way, since he is still an advisor to the company, I am confident that he is assisting in the transition to the new accounting system in whatever way he can. In the event that I jumped the gun on his departure to a new job in my earlier blog and was not accurate in my assessment of that situation, I apologize.
The shareholder report was interesting as it discussed an acquisition that occurred of which I was unaware. Gateway acquired CNC Repos for thier vendor and client base, as well as the existing management. I knew that they had been looking at that firm, but until I saw it in the letter to shareholders, I did not know that the acquisition had actually occurred. I am not sure at this point if CNC Repos was rolled into Elite Machine Tool Company or not, as the acquisition does not show up as a subsidiary under the "Companies" portion of the new site under the Machine and Tools Group section. If I get clarification on that I'll update later.
I think this is a positive step for Gateway as it gets them back on the acquisition roll-up track, which gives Gateway the potential to accelerate its growth beyond typical operation expansions. They have been excellent at doing this over the past 6 years. Had it not been for the acquisitions of Bechler Cams, Inc. and Nelson Engineering, Inc. - two deals that unfortunately did not work out - I think that the other acquisitions would have worked out much better. As it is they have still acquired Eran Engineering, ESK (rolled into Eran), All-American CNC Sales and now, CNC Repos. In their new facility, they certainly have the ability to acquire several more manufacturing firms and roll them right into the new footprint. By the way, I have visited the new facility on 2 occassions. It is very nice, well laid out, and offers HUGE opportunity for growth. Given that this company has average about 50% top end growth each year for the past 5-6 years, I have no reason to believe that they will not continue to keep that record in tact.
I will be keeping in contact with Gateway in the upcoming months and plan to keep a "finger on the pulse" to make sure they continue to move towards their relisting. At this time I am cautiously optimistic and hope that we will have this little gem back to trading publicly over the next quarter or two. For those who have contacted me over the past month and told me of your frustrations, just know that I am staying patient and ask the same from you and let's see if we are rewarded.
Stay tuned!
DISCLOSURE: I worked with Gateway as a Capital Markets Advisor and Investor Relations Consultant from 2003 thru December 31, 2007. However, while they remain a private, non-trading company, I am not under any type of contract at this time. Also for the record, as part of my Private Equity holdings, I own stock in Gateway International Holdings and have clients that own stock in the company as well.
Tim has assured me that they are moving forward in their efforts re-file a Form 10SB with the SEC. While I don't think that the company is going to put a specific date out there for investors to look ahead to, based on the general tone of our conversation, I am "hopeful" that we will see a filing sooner than later, perhaps even by this summer. Gateway operates on a June 30 year end, so perhaps that will have an influence, although I am unsure at this juncture.
A Form 10SB filing would be a welcomed relief and I believe that the guys over at Gateway are genuinely good guys and are trying to do what is right by the shareholders. Tim assured me that he is pressing forward. Having had many face to face meetings with Tim, I believe him.
According to the new Gateway website, http://www.gih-inc.com/, Steve Kasprisin, is apparently still a Director with Gateway, so perhaps there is more to that story than I am aware of. Either way, since he is still an advisor to the company, I am confident that he is assisting in the transition to the new accounting system in whatever way he can. In the event that I jumped the gun on his departure to a new job in my earlier blog and was not accurate in my assessment of that situation, I apologize.
The shareholder report was interesting as it discussed an acquisition that occurred of which I was unaware. Gateway acquired CNC Repos for thier vendor and client base, as well as the existing management. I knew that they had been looking at that firm, but until I saw it in the letter to shareholders, I did not know that the acquisition had actually occurred. I am not sure at this point if CNC Repos was rolled into Elite Machine Tool Company or not, as the acquisition does not show up as a subsidiary under the "Companies" portion of the new site under the Machine and Tools Group section. If I get clarification on that I'll update later.
I think this is a positive step for Gateway as it gets them back on the acquisition roll-up track, which gives Gateway the potential to accelerate its growth beyond typical operation expansions. They have been excellent at doing this over the past 6 years. Had it not been for the acquisitions of Bechler Cams, Inc. and Nelson Engineering, Inc. - two deals that unfortunately did not work out - I think that the other acquisitions would have worked out much better. As it is they have still acquired Eran Engineering, ESK (rolled into Eran), All-American CNC Sales and now, CNC Repos. In their new facility, they certainly have the ability to acquire several more manufacturing firms and roll them right into the new footprint. By the way, I have visited the new facility on 2 occassions. It is very nice, well laid out, and offers HUGE opportunity for growth. Given that this company has average about 50% top end growth each year for the past 5-6 years, I have no reason to believe that they will not continue to keep that record in tact.
I will be keeping in contact with Gateway in the upcoming months and plan to keep a "finger on the pulse" to make sure they continue to move towards their relisting. At this time I am cautiously optimistic and hope that we will have this little gem back to trading publicly over the next quarter or two. For those who have contacted me over the past month and told me of your frustrations, just know that I am staying patient and ask the same from you and let's see if we are rewarded.
Stay tuned!
DISCLOSURE: I worked with Gateway as a Capital Markets Advisor and Investor Relations Consultant from 2003 thru December 31, 2007. However, while they remain a private, non-trading company, I am not under any type of contract at this time. Also for the record, as part of my Private Equity holdings, I own stock in Gateway International Holdings and have clients that own stock in the company as well.
Monday, March 3, 2008
Big Banks: Time to Buy?
I was at a venture capital summit in January where a banking analysts suggested that historically banks are a screaming buy when they can be purchased for less than book value. I tend to agree with that assessment, however, when the book value is constantly being reduced due to significant write-downs as a result of the subprime mess, that theory gets a little muddy.
Now that I have convinced you that banks are not worth looking at due to unknowns, let me confuse you even more by stating that I am starting to think the major risks are out there and the upside is getting better every day. Are we still in a slumping housing market that continues to leave unexposed risk the the investor? Yes. Are we staring a possible recession in the face that could cause things to worsen even more? Yes. Is the sky falling? No.
One thing that most investors would agree on is that banks are in the money business. They are some of the leading experts on how to turn a profit. When the opportunity exists to purchase leading banking instutions at nearly 50% discounts, while raking in 6%-8% dividend yields, smart money gets in and expects to go on a bumpy ride.
My top TWO: Bank of America (NYSE: BAC) and Wachovia (NYSE: WB).
BAC is strategically positioned to do better than their peers once the current cycle of real estate debacle and "flipper depression" is over. They are buying Countrywide on the cheap and in a few years BAC shareholders will reap the benefits. Getting paid 6.2% to ride the storm is not a bad way to spend a couple of years. The stock WILL be higher in the next 24-36 months.
WB is one of my favorite bank stocks. They are well managed, they did a fair job in keeping the Wachovia culture by dropping the First Union baggage to a large degree. Perhaps most intriguing, they currently pay an 8% dividend, so I get paid well while I wait.
There might be more negatives to come in this sector, but neither of these banks is going to go out of business and both should be stronger than their peers when the storm passes.
DISCLAIMER: I have no relationships with either of these banks in any capacity except as a customer and shareholder.
Now that I have convinced you that banks are not worth looking at due to unknowns, let me confuse you even more by stating that I am starting to think the major risks are out there and the upside is getting better every day. Are we still in a slumping housing market that continues to leave unexposed risk the the investor? Yes. Are we staring a possible recession in the face that could cause things to worsen even more? Yes. Is the sky falling? No.
One thing that most investors would agree on is that banks are in the money business. They are some of the leading experts on how to turn a profit. When the opportunity exists to purchase leading banking instutions at nearly 50% discounts, while raking in 6%-8% dividend yields, smart money gets in and expects to go on a bumpy ride.
My top TWO: Bank of America (NYSE: BAC) and Wachovia (NYSE: WB).
BAC is strategically positioned to do better than their peers once the current cycle of real estate debacle and "flipper depression" is over. They are buying Countrywide on the cheap and in a few years BAC shareholders will reap the benefits. Getting paid 6.2% to ride the storm is not a bad way to spend a couple of years. The stock WILL be higher in the next 24-36 months.
WB is one of my favorite bank stocks. They are well managed, they did a fair job in keeping the Wachovia culture by dropping the First Union baggage to a large degree. Perhaps most intriguing, they currently pay an 8% dividend, so I get paid well while I wait.
There might be more negatives to come in this sector, but neither of these banks is going to go out of business and both should be stronger than their peers when the storm passes.
DISCLAIMER: I have no relationships with either of these banks in any capacity except as a customer and shareholder.
Monday, February 25, 2008
(OTCPK: RDXH) Redux Holdings
Redux Holdings announced today that they have acquired the remaining shares of Koloseum Nutritional Sciences ("KNS") that they didn't already own. (FYI: they owned 30% before today's announcement.) This has obviously been in the works for a while as the owners of KNS, Rick Robinette and Milos Sarcev, have been part of the Naturade team for many months now as Chief Operating Officer and Chief Science Officer, respectively.
So what does this transaction really mean? Is it important?
Well, here is what I think it does for the Company. First, it provides a new product line to market alongside the Naturade brand to a large network that is already in place. Naturade is in stores all across the United States (as well as some international locations) like grocery stores, natural food stores, Sam's Clubs, vitamin stores and many more. The Naturade brand typically targets the mass audience (moms and pops of the world).
The KNS line targets athletes.
Why does it matter? Well, is there a more efficient way to introduce leading edge, proprietary, nutritional formulas into your "everyday" product line than to take it from a sister product line that already produces supplements for world class athletes?
I have met with both Rick Robinette and Milos Sarcev and believe they are both savvy businessmen. Rick is a marketing guy with many industry credits to his name. He has been around the industry for about 20 years and is well connected with buyers (these are the people that work for the retailers and represent the contact point that you want to know in order to get your products the required shelf space.)
Milos Sarcev has been quoted by top fitness magazine editors (FLEX Magizine) as having one of the best minds of our age regarding health and nutrition and how it relates to developing the body. Milos was the 1989 Mr. Universe and has an incredible ability to train high end (mostly professional) athletes and maximize their performance. Now that KNS will be available on a wider distribution, athletes around the globe will be able to get the benefits of Milos’ most advanced nutritional formulas.
Now that Naturade has exited bankruptcy and appears to be on sound footing financially, I am looking forward to seeing how that Company grows its distribution network. Adding KNS to the mix should add another quality product to the offering and should be a step in the right direction.
DISCLOSURE: I am a large holder of Redux stock as I assisted Redux in becoming a public entity back in 2006. I continue to work with the Company on IR and Capital Markets Advisory issues and receive compensation for my services.
So what does this transaction really mean? Is it important?
Well, here is what I think it does for the Company. First, it provides a new product line to market alongside the Naturade brand to a large network that is already in place. Naturade is in stores all across the United States (as well as some international locations) like grocery stores, natural food stores, Sam's Clubs, vitamin stores and many more. The Naturade brand typically targets the mass audience (moms and pops of the world).
The KNS line targets athletes.
Why does it matter? Well, is there a more efficient way to introduce leading edge, proprietary, nutritional formulas into your "everyday" product line than to take it from a sister product line that already produces supplements for world class athletes?
I have met with both Rick Robinette and Milos Sarcev and believe they are both savvy businessmen. Rick is a marketing guy with many industry credits to his name. He has been around the industry for about 20 years and is well connected with buyers (these are the people that work for the retailers and represent the contact point that you want to know in order to get your products the required shelf space.)
Milos Sarcev has been quoted by top fitness magazine editors (FLEX Magizine) as having one of the best minds of our age regarding health and nutrition and how it relates to developing the body. Milos was the 1989 Mr. Universe and has an incredible ability to train high end (mostly professional) athletes and maximize their performance. Now that KNS will be available on a wider distribution, athletes around the globe will be able to get the benefits of Milos’ most advanced nutritional formulas.
Now that Naturade has exited bankruptcy and appears to be on sound footing financially, I am looking forward to seeing how that Company grows its distribution network. Adding KNS to the mix should add another quality product to the offering and should be a step in the right direction.
DISCLOSURE: I am a large holder of Redux stock as I assisted Redux in becoming a public entity back in 2006. I continue to work with the Company on IR and Capital Markets Advisory issues and receive compensation for my services.
Wednesday, February 13, 2008
OTCBB: CYRX - In the news?
Now I don't typically put a lot of credence in what is posted on chat boards; however, a year or so ago I was made aware of a large manufacturing firm in the dry ice space that wanted a piece of the action over at CryoPort. At that time I heard that the manufacturing firm was willing to commit a million sq ft of floor space to ramp up the large scale production of the CryoPort Express One-Way Shipper.
Today on http://www.icecoldstocks.com/, the Iceman made a quick "whisper" comment during his "Dollar Man" podcast about possible news of a European manufacturer that was earmarking up to a million square feet to work with CryoPort. Now I don't know if it is the same manufacturing firm, I would bet that it is, and I don't know when the deal will become public, if there is one. But ... I do know that if a billion dollar manufacturing firm is dedicating a million square feet of their floorspace to support the CryoPort Express One-Way Shipper, they are not doing it for free and they expect to do A LOT of shippers. A million square feet is an enormous facility, which has a large carrying cost. If this "whisper" by the Iceman comes to fruition, I would expect things over at CryoPort to start picking up pace very rapidly.
Dollar Man Commentary: HERE (Audio: CYRX at the very end.)
Whisper Page: HERE (Text: CYRX is at the top.)
I really don't think that many investors have really put together a vision for their CYRX shares in regards to future valuation. Well, just take some very ballpark figures for example. There have been "rumors" on internet boards that FedEx ships over 300 million frozen packages on a global basis each year. If CryoPort were to ship 100 million shippers each year at an average of say, $80 per shipper (including shipping costs), they would do $8 billion (that's billion with a "B") in revenues. They would have to account for cost of manufacturing, shipping and corporate expenses. While I think they have better margins, let's assume that they can make 8% net profit based on the top end revenue line, they would make $640,000,000 in earnings. Currently, on a fully diluted and converted basis, they would have about 55-60 million shares outstanding.
You do the math.
DISCLOSURE: I worked with CryoPort from mid 2004 thru August 2007. I assisted them in becoming a public company and I am pretty comfortable with the story. On my private equity side, I own stock and warrants in CryoPort. I have not sold any stock to date and don't intend to sell any stock anywhere remotely close to the current price. I might look to sell a few shares over $10. For the record, I am not working with them in any capacity at this time.
Today on http://www.icecoldstocks.com/, the Iceman made a quick "whisper" comment during his "Dollar Man" podcast about possible news of a European manufacturer that was earmarking up to a million square feet to work with CryoPort. Now I don't know if it is the same manufacturing firm, I would bet that it is, and I don't know when the deal will become public, if there is one. But ... I do know that if a billion dollar manufacturing firm is dedicating a million square feet of their floorspace to support the CryoPort Express One-Way Shipper, they are not doing it for free and they expect to do A LOT of shippers. A million square feet is an enormous facility, which has a large carrying cost. If this "whisper" by the Iceman comes to fruition, I would expect things over at CryoPort to start picking up pace very rapidly.
Dollar Man Commentary: HERE (Audio: CYRX at the very end.)
Whisper Page: HERE (Text: CYRX is at the top.)
I really don't think that many investors have really put together a vision for their CYRX shares in regards to future valuation. Well, just take some very ballpark figures for example. There have been "rumors" on internet boards that FedEx ships over 300 million frozen packages on a global basis each year. If CryoPort were to ship 100 million shippers each year at an average of say, $80 per shipper (including shipping costs), they would do $8 billion (that's billion with a "B") in revenues. They would have to account for cost of manufacturing, shipping and corporate expenses. While I think they have better margins, let's assume that they can make 8% net profit based on the top end revenue line, they would make $640,000,000 in earnings. Currently, on a fully diluted and converted basis, they would have about 55-60 million shares outstanding.
You do the math.
DISCLOSURE: I worked with CryoPort from mid 2004 thru August 2007. I assisted them in becoming a public company and I am pretty comfortable with the story. On my private equity side, I own stock and warrants in CryoPort. I have not sold any stock to date and don't intend to sell any stock anywhere remotely close to the current price. I might look to sell a few shares over $10. For the record, I am not working with them in any capacity at this time.
Friday, February 1, 2008
(OTC: RDXH) Redux Holdings, Inc.
Redux Holdings, Inc. (Quote: RDXH) is a stock that is not really on anyone's radar at the present time. In a nutshell, Redux goes out and acquires distressed companies and/or cherry picks assets from distressed companies that private equity firms, hedge funds, mutual funds, venture capitalists, etc. would like to get rid of. The management team at Redux is an experienced group of industry veterans comprised of members of Enterprise Solutions Group (http://www.eginc.net) and others. The team is experienced in M&A plays of financially or operationally distressed companies and has handled companies ranging from millions to billions.
Just a heads up: An interesting article about Redux Holdings is currently on the front page of the current Los Angeles Business Journal titled: Company Spinning Turnaround Process.
In 2005, Adam Michelin, Redux's CEO, asked me if I would be interested in assisting him in building a publicly traded M&A firm that would focus on turnaround scenarios in leveraged transactions. I told him that I might, it would just depend on the deal. After doing a little more due diligence on Adam, I realized that he was a well established, well connected and well respected player in the distressed company turnaround industry. I agreed to move forward on the project and Redux Holdings was the result of these joint efforts.
For those who are wondering what the name Redux means, according to a Latin translation (freely available on the internet): Redux - ducis adj.: act. [bringing back , restoring]; pass. [brought back, returned].
My definition: “Rebirth”: ie: rebirth of an asset; taking an asset that was mismanaged or which failed for a specific reason and isolating and repairing the deficiency while returning the asset to its full potential value.
The root name is a proper description of what the company does with selected “orphaned assets” and distressed corporations. Redux identifies the valuable assets that are part of a poorly run operation, strips them out and isolates them in a new entity, brings in the necessary management and capital to fix any outstanding issues and returns the asset to profitability.
The primary objective for Redux Holdings is to identify potentially beneficial assets, acquire them at deeply discounted prices, and quickly restore them to profitable operations. The firm focuses on primary areas in which it intends to maintain a long term presence, called Permanent Core Groups. Currently, the core groups consist of:
1.) Consumer Services
2.) Nutrition and Supplements
3.) Technology
I won't go into great detail on my blog since I have an Investor Fact Sheet available on my website that can be downloaded free of charge. The fact sheet gives a much more in-depth overview of the pieces that are currently in the Redux portfolio. I am presently working on updating this for the Company, but this somewhat dated version still provides a pretty accurate picture and gives a good overall review.
I am currently discussing Redux with a number of accredited investors on my private equity side and I believe that Redux is on the right track. Redux bought the majority ownership of Naturade (Quote: NRDCQ) in August 2006. (Not sure why they have not dropped the “Q”, but getting that resolved is in process.) Anyway, Naturade had been cash flow negative for 5 years prior to Redux taking control. In November 2007, Naturade came out of bankruptcy and was recently put back on the OTCBB (See January 18, 2008: 8k filing). Although I am not sure of the method that will be used to implement a filing, I expect that Redux will become OTCBB in the near future as well.
DISCLOSURE: I helped this company to become public, I own stock in the company and I am a compensated consultant to the company for IR and Capital Markets Advisory.
Additional note: The float on this company is very small, I own a bunch of shares and there is not much stock available for trading. When it does start trading, I expect it will be tough to find stock to buy, but that is okay with me, since I already own my shares. :)
Just a heads up: An interesting article about Redux Holdings is currently on the front page of the current Los Angeles Business Journal titled: Company Spinning Turnaround Process.
In 2005, Adam Michelin, Redux's CEO, asked me if I would be interested in assisting him in building a publicly traded M&A firm that would focus on turnaround scenarios in leveraged transactions. I told him that I might, it would just depend on the deal. After doing a little more due diligence on Adam, I realized that he was a well established, well connected and well respected player in the distressed company turnaround industry. I agreed to move forward on the project and Redux Holdings was the result of these joint efforts.
For those who are wondering what the name Redux means, according to a Latin translation (freely available on the internet): Redux - ducis adj.: act. [bringing back , restoring]; pass. [brought back, returned].
My definition: “Rebirth”: ie: rebirth of an asset; taking an asset that was mismanaged or which failed for a specific reason and isolating and repairing the deficiency while returning the asset to its full potential value.
The root name is a proper description of what the company does with selected “orphaned assets” and distressed corporations. Redux identifies the valuable assets that are part of a poorly run operation, strips them out and isolates them in a new entity, brings in the necessary management and capital to fix any outstanding issues and returns the asset to profitability.
The primary objective for Redux Holdings is to identify potentially beneficial assets, acquire them at deeply discounted prices, and quickly restore them to profitable operations. The firm focuses on primary areas in which it intends to maintain a long term presence, called Permanent Core Groups. Currently, the core groups consist of:
1.) Consumer Services
2.) Nutrition and Supplements
3.) Technology
I won't go into great detail on my blog since I have an Investor Fact Sheet available on my website that can be downloaded free of charge. The fact sheet gives a much more in-depth overview of the pieces that are currently in the Redux portfolio. I am presently working on updating this for the Company, but this somewhat dated version still provides a pretty accurate picture and gives a good overall review.
I am currently discussing Redux with a number of accredited investors on my private equity side and I believe that Redux is on the right track. Redux bought the majority ownership of Naturade (Quote: NRDCQ) in August 2006. (Not sure why they have not dropped the “Q”, but getting that resolved is in process.) Anyway, Naturade had been cash flow negative for 5 years prior to Redux taking control. In November 2007, Naturade came out of bankruptcy and was recently put back on the OTCBB (See January 18, 2008: 8k filing). Although I am not sure of the method that will be used to implement a filing, I expect that Redux will become OTCBB in the near future as well.
DISCLOSURE: I helped this company to become public, I own stock in the company and I am a compensated consultant to the company for IR and Capital Markets Advisory.
Additional note: The float on this company is very small, I own a bunch of shares and there is not much stock available for trading. When it does start trading, I expect it will be tough to find stock to buy, but that is okay with me, since I already own my shares. :)
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