A game changing event in a down trending stock. That is what the EU legislation presents to the picture here.
The uptrend that can come from this game changer could be enormous for several reasons.
First, it use to be on the Nasdaq. So one has to analyze why it is here in penny land on life support. The bio plastic resins made by Cereplast fulfills an ever increasing need on many levels. The market is just beginning to catch up to the available technology via the EU laws, the increasing plastic bag bans in the US by municipalities. The dilution of the past to present is what has kept the lights on waiting for the game changer here.
Secondly, since coming to penny land this co has still operated under the same principles (shareholder votes, press releases, on time filings, etc) as in a Nasdaq listing. Why do this if not both expecting to and trying to, bring this stock back to a listing on the Nasdaq? If you are looking for a stock to go from pennies to dollars, it's not too likely to happen if the CEO doesn't have a personal ambition to bring the stock to a Nasdaq listing. Because of the history of this co, I'd dare to say that Frederic Scheer takes it quite personal...and it will be a moment of personal triumph for him to have weathered the storm and restored his craft to the lofty height he set his sight on so long ago, and place his company in good standing back in the Nasdaq at a loftier pps than before. JMOHO.
The Italian market is the first step, representing I think I read a potential 40 million revenue potential for Cereplast. This is bringing the market at digestible sizes for the co. The rest of the EU market may quickly follow the lead of the Italians, for the sake of convenience. Yet if they come in slow enough, Cereplast may be able to quickly expand to accommodate the rapidly emerging markets.
These trends make the upside potential here huge, and may well make this a grand slam home run. It is always a risk to invest in a down trending stock, yet the fact remains: an expected game changing event has occurred in the EU. Now we patiently wait for the results.
The timing. The funny thing about the many here in penny land that bash a stock or a CEO...the basher has rarely ventured so bold of risk as what the CEO has endeavored. And the basher wants his results in total in the next ten days, so he can retire and do nothing.
I think it likely that revenues may pick up very significantly into next year, yet also while enjoying new record revenues, this company is likely to be expanding...and spending to expand...to accommodate the demand that is too great for it today. The Italian market could be a great demand in the next few months. The rest of EU...not sure if CERP is able to meet the production demand that can arise from the new EU measures, at this moment. So the time from now to shareholders seeing what we all want to ($$$), may take longer with more growing pains ahead, but with more growth comes greater potential for what we want to see ($$$$$).
Lastly, I'm not sure on shares outstanding and the fears some have expressed about a possible reverse split as was approved by a vote for staving off a potential hostile takeover, but as I see things, that would be one of two reasons Mr. Scheer may undertake that avenue at this point. The other potential reason I see is one I wouldn't mind as a shareholder here, to shore the stock up for reenlistment in the Nasdaq to increase pps. If pps increases to $10-$20 per share at that event, I think we could all be happy. (Of course, all the happier with no rs!)
That is my opinion from all the DD I've read. I'm sorry I don't have the time to include links in this post for others to examine, but those are my thoughts about this company and it's potential. GLTY
