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.
Tuesday, July 22, 2008
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 ~
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