Cadiz Inc. (CDZI)

[@LaughinPaulRyan]

… CADIZ PLEASE … $CDZI #LootWallStreet

LOS ANGELES, April 6, 2023 /PRNewswire/ -- Today, Cadiz, Inc. (NASDAQ: CDZI/CDZIP) ("Cadiz", the "Company"), a clean water solutions company, announced that it completed construction of three new groundwater wells at the Cadiz Ranch increasing the wellfield to 12 production wells with an annual capacity of 36,000 acre-feet of water per year (AFY). With the new wells online, the Cadiz Ranch wellfield will have sufficient capacity to deliver the full volume of the Company's Northern Pipeline, or 25,000 AFY, and also continue to support current agricultural operations at the Cadiz Ranch.

"Our mission is to deliver clean, reliable and affordable water to people," said Susan Kennedy, Executive Chair of Cadiz. "Our wellfield and infrastructure will provide both reliable new supply during extreme drought periods and underground storage during extreme wet periods."

The Cadiz wellfield at the Ranch captures groundwater that would otherwise be lost to evaporation from the base of a significant Mojave Desert watershed for agricultural irrigation. The Cadiz Ranch farming operation follows a sustainable groundwater management plan that has been administered by the County of San Bernardino since 1993. In 2012, the County also approved permits for the Cadiz Water Conservation and Storage Project that authorizes conservation of 50,000 acre-feet per year for beneficial supply uses in communities in Southern California. The project also offers one million acre-feet of storage capacity for imported surplus water in wet years.

In late March, the Salton Sea Authority Board of Directors voted to approve a four-party contract with Cadiz, the Coachella Valley Water District ("CVWD") and the Torres Martinez Desert Cahuilla Indians securing 5,000 acre-feet per year of water supply from Cadiz to support restoration of the Salton Sea and health, safety, and economic development on Tribal lands and in disadvantaged communities in eastern Coachella Valley, once the Project pipelines are operational. In February, CVWD also approved the contract.

"Despite recent rains, the Colorado River system remains under pressure with long-term projections of shortage that will alter reliable deliveries to all of Southern California" said Scott Slater, Cadiz CEO. "We are happy to be able to contribute to solutions for communities affected by these systemic changes."

[wickerman]

$CDZI insane drop on no news but seems manipulated

[@LaughinPaulRyan]

… we bought the dip with 25% of our portfolio … $CDZI #LootWallStreet

[Professor Fractal]

Public market valuation is pure water hype.

Discounted cash flow valuation is less than $8 per share.

Apollo convertible notes priced at $6.75, "smart money"

Stock currently trading at over $11.00 per share.

Finally SB 120 passes and Cadiz Water Project has line of sight to construction! But wait the stock price didn't rebound after the passage? Why not? What's going on here? Who is manipulating the stock? And what's the project fundamentally worth?
The Cadiz Water Project could now be, hypothetically, built in approximately 18-months costing ~$200-275M and financed by Apollo. When the project is built CDZI will finally be able to sell 50,000 acre feet of water per year at a price of $639-$1089 per acre foot and plans to realize net operating income of $500-$600 per acre foot year with contracts written to escalate at 3% per year. Assuming the project is built in 18-months:

2020: 50,000 AFY x $550 AF = $27,500,000 in net operating income
2021: $28,325,000 net operating income
2022: $29,174,750 net operating income
etc. for perpetuity lets say and assume they continue to operate forever...now how do we value this free cash flow?

Easy as a perpetual annuity payment since we expect these contracted cash flows to continue forever. (though the project is planned for 40-years, we expect it could operate till the watershed runs out of water).
$27,500,000/Discount rate = Free Cash Flow to Cadiz
Now what is the appropriate discount rate? Well the company debt financing to date is at least 7-8% and equity typically costs more (10% is the Warren Buffet general discount rate) but lets be generous, subtract escalation and round it so the total cost of capital for Cadiz is only 7% so:

$27,500,000/7% = $589M PV free cash flow to Cadiz! Now we know the project will cost money to build ~$250M and holds $63M in debt so we have to pay that off before we can claim money as shareholders. This means

$589-$250-$63 = $276M in equity value remaining.

So $276M/shares outstanding or 276,000,000/22,200,000 = $12 per share! But wait we still need to handle the convertibles... Now since Apollo holds convertibles at $6.75 we can assume that they will convert these bonds into stock causing an additional 12,700,000 shares to be issued that means that the fully diluted shares outstanding is 34,900,000...
But $276,000,000/34,900,000 = $7.91 per share WTF!!?!?! How can we be waiting all these years for this project and the stock be trading for more than the project is actually worth once built??? Well Apollo clearly knew what was going on and price their convertibles under fair value...

Of course while SB 120 passed, the project also still needs to finalize proposals with the Metropolitan Water District which represents coastal Southern California counties from San Diego to Los Angeles and there have been accusations of bribery and corruption overhanging contracting. And the project needs to clear the State Land Commission which is holding hearings to review the project's planned use for State Lands. These lands are leased for rail road use and Cadiz plans to sublease the lands for water pipeline construction. So hopefully, maybe, the project gets built by the end of 2019 or more likely 2020 so we will have to continue waiting....

Since just over 50% of the project is institutionally held, it seems like retail money is left holding the bag on this much hyped and contested water project. Sadly Cadiz seems like another much hyped story stock that caught retail investors in a value trap.

[TheFinalCD]

SMART

[TheFinalCD]

DOUBLE BOOM

[LongTrader718]

What goes up will come down.
Time to take a short position
At the top.

[TradeSmart.ai]

Woah!!! What's going on here?

[realfast95]

Open Outcrier ?@OpenOutcrier 25m25 minutes ago

$CDZI on on highs (has project #15 on Trumps rumored infrastructure list)


https://www.documentcloud.org/documents/3409546-Emergency-NatSec50Projects-121416-1-Reduced.html

[realfast95]

Quoth the Raven ?@QTRResearch 8m8 minutes ago

From a friend on $CDZI: "Over 3 million shares short and 17 days to cover based on average volume. Could be a face ripper."

[stocktrademan]

CDZI bullish 7.03

[stocktrademan]

CDZI bullish 5.90

[PAC]

CDZI 5.9 BOOOOM

[PAC]

CDZI 5.26 holding up well in market rout past two days . News of contracts last week. Likely more upside $7+

[Jack30]

http://smwd.com/news/press-releases/press-releases-archive/2011-10-20.html

[THOR]

Agree it's going back up !!

[magness]

I think that's the bottom of that pullback----> now other way! Strongly bullish! What do you think guys?

[514]

Nice day here !! Sold 3/4 am spike

Sold rest mid day :(

TANH got spanked lol will have a bounce oo

[@LiftedCapital]

I SOLD TO EARLY!!! IT IS A CAUSE OF SELF DOUBT!!! WONT EVER HAPPEN AGAIN!!! I AM THE BEST!!! THIS WAS AN EXCELLENT BETA TEST FOR ME!!!

GO CDZI GO

[DilutionDan]

KABOOMAGE! Easy peazy lemon squeezy.

[magness]

Looks good over 3.30 for a squeeze higher

[@LiftedCapital]

FOR THE RECORD IM OUT ON MORNING POP TY ALL

[@LiftedCapital]

WEEEEEEEEEEEE CDZI JUST CUZ

[blindjohn]

Ah Jeah. For shizzle

[@LiftedCapital]

$CDZI SETTING UP FOR MASSIVE GAINS HERE ...

[secrethandshake]

ahhh good to see some life here...hey everyone ! CDZI on the move \m/

[@LiftedCapital]

CHICKEN SKIN MOMENT!!!

CDZI FTW

[514]

Lol

[DilutionDan]

Yeah, that 160 share whackadoodle there after hours gave me a warm fuzzy feeling inside.

[@LiftedCapital]

LOL I LOVE AFTER HOURS SLAPSTERS

[blindjohn]

$3.40 after hours. Hope to see $4.00 tomorrow!

[blindjohn]

Boom Boom! Bitch assss motha fuckn shorts gonna get whacked tomorree

[514]

all good in da hood

[blindjohn]

One stock at a time for me, so I like watch one and 5 minute chart all day and commentate

[514]

Yea lol

Who cares u pay diz forum for that

[blindjohn]

Nice yea I post too much lol

[514]

record volume / bullish engulfing / +10% / dip recovery

ill take it

[blindjohn]

Let's see a string close

[blindjohn]

Huge bid whack3r haha

[blindjohn]

Let's see a big slap over $3.20 ... $3.30 +close would be schweet

[blindjohn]

Yes big time correction upppp

[@LiftedCapital]

OBVIOUS INTRADAY CORRECTION COMING

[blindjohn]

May see a sudden spike up soon. If it crosses $3.19 it'll be good

[@LiftedCapital]

YUP BID WHACKING IS RAMPID HERE!!! IM IN @ $2.84 AND HOLDING FOR REVERSAL!!!

[blindjohn]

Damn , that's crappy man. I think it'll try again soon.

[DilutionDan]

I'm new here. Just got in this morning 1100 @3.16 I'm no expert but there seems to be a bit of whacking going on here to keep it on the downside imo. I wanted to get out around 3.30 but my boss walked up as I was trying to set my sell order, lol. I hate it when that happens!

[blindjohn]

Volume dried up for lunch breaks

[blindjohn]

Yes sir. Just getting started here

[@LiftedCapital]

AND SO ARE MM's

CDZI EPIC PINCHER PLAY

[blindjohn]

Glad I stopped lossed damn... She needed to breathe a bit.