Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
They view the rest of us as members of the Flat Earth Society.
I still ponder that 100 million share shelf offering...
Ask Management Feb 8, 2012 states that they have invested millions in upgrades to their current production facilities
Ask Management June 15, 2011 Capstone does not need to invest significant additional capital to increase its plant capacity as we are currently only running at approximately 30% of our total capacity with today’s single shift of operations five days per week.
Q3 2012 EC Presentation Slide 8 graphs show a quadruple increase in revenue while maintaining relatively flat labor and overhead
Jamison's statement on CC several quarters back that he didn't foresee any need for additional share offerings as they had sufficient revenue and reserves to enable them to continue on road to profitability without further dilution.
Renewed line of credit with bank several quarters back.
So, could someone explain the need for this 100 million share offering? How's the planning on that Chatsworth visit coming along Capt'n?
Dang Capt'n I should have thought of that! Instead I went out and moved some dirt which didn't help as much as putting my finger on the work bench and hitting it with a hammer--forgot all about Capstone for awhile LOL.
What really gets me about this stock is all of the smoke and mirrors, i.e. unknown trades, shadow trades, dark pools etc. Then we have one CC where Jamison states he sees no reason to further dilute and several months later does just that. Idle plant capacity of 75% but Jamison states that he can ramp up without new hires...if that is the case does he have excess capacity in labor?
We were all hoping for some good news after last Friday's amended S-3 and pretty good news was announced on Monday. The pretty good news obviously didn't trump the pending dilution. I can see dilution if a really huge order comes in requiring vast expenditures on parts and components, but I thought that was what the newly settled credit line was for. Like chklingon said last week "Dilution trumps news every time."
Folks have mentioned that Jamison makes a million bucks a year. If that is the case he should immediately slash his own paycheck until he demonstrates that he is able to generate a decent margin and return on investment for the shareholders.
Capstone is killing me as I wait for next quarter, next year, next decade....I'm pretty patient with my investments and am certainly locked in with Capstone for awhile. Thank goodness for Cheniere (LNG) for off-setting Capstones downturn today; LNG up over 9% today. Their margins aren't expected to improve until commissioning of the Sabine Pass export facility in 2014-2016, depending on who's guessing. Trading at $17.14 from a year low of $3.14. Heck, I sold Westport Innovations (WPRT) to buy more CPST. WPRT is up 200% since that trade.
The computers seem to be waging an epic battle to keep Cap below a buck. It seems that no one is selling except the computers...patience will be rewarded.
Look at level 2 and you'll note that those shares are computer driven and are being picked off at .0001 spread between bid/ask in 100 share blocks.
Me too, its going to be a miracle if I survive. Perhaps all of my pennies will be enough to place a Capstone above my grave.
Nothing but machine trading today--100 share lots being fired off at .0001 cent. Another not so interesting article in the WSJ yesterday dealt with the computer algorithms that instantly see orders as they emerge (eMerge--another miracle I saw it disappear) and instantly trade ahead of them. This SEC investigation looks at "Dark Pools" and "Shadow Trading." Basically the traders, Pipeline & Milstream, would fill an order and then sell it to the client. On a sell order Milstream sells "borrowed" shares then buy the clients shares and then use them to cover the short.
More about Dark Pools Pipeline-Milstream and of course Direct Edge. Its a rigged game for sure.
It is sure out of our hands with the bid/ask spread is down to .0001 to .0002 cents and trades in 100 share lots.
Looks like the new ingredients weren't "baked" into the dilution price. Unbelievable that the IHs can take it down this far on news of 10mw orders with a near term delivery and commissioning.
I tried to get in at the 98 cent level during the last dip but had to settle a bit higher. Even if I had dry powder left I would question getting in again. For us retail investors this is painful. I'm in for the long term but dang! Hopefully this short covering will end someday, and "they" will get to eat some shortcake. Of course if they are covering and buying they get a new ride.
But why no notification in our mail box?..
The filings hit my mailbox at 4:11 PM and 4:16 PM.
Re: Me "Has the dilutive effect of the "shelf offering" of 100 million shares already been baked in the current share price?"
Car Hauler Post# 12141
Yes, it has, this is old news, just a slight change. No worries!
Yes, I would assume it has too, as I loaded another boat on that dip. As the Capt'n would say "Monday will tell the tale." I've used up all of my dry powder so am along for the ride no matter what.
The February 3, 2012 S-3 (Registration No. 333-) filing announced the intent to issue up to 100 million shares.
On February 28, 2012 a S-3MEF (Registration No. 333-) was filed adding 13,688,005 shares to the original February 3, 2012 S-3 and states that THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE UPON FILING WITH THE SECURITIES AND EXCHANGE COMMISSION IN ACCORDANCE WITH RULE 462(b) UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
The April 6 S-3 (Registration No. 333-179334) is not announcing any additional shares, so does that mean that the 02/28 13,688,005 shares have already been issued?
Has the dilutive effect of the "shelf offering" of 100 million shares already been baked in the current share price?
Furthermore,
Back to the April 6 S-3A again--
The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.
This for you Capt'n...does the above mean that the 100 million shares be offered as soon as the Commission accepts it? All way above my pay grade, but I'm with Wild Bill, i.e. announce the sale of 1000 C65s or a hundred C1000s to Japan. That would cause all of us to exhale, as it would definitely provide some transparency to the use of the capital.
"Buy the rumor, sell the news?" Monday will tell who is squeezed, but of course I could be completely wrong.
Just filed a form S-8 CAPSTONE TURBINE CORPORATION INDUCEMENT AWARDS 250,000 or 255,000 shares at $1.02 per share.
The 100 million (100 Million? filed under the S3/A is to be used for what the heck ever they want to use the for. To wit: [b]Unless we indicate otherwise in an accompanying prospectus supplement, we intend to use the net proceeds from the sale of the securities offered by this prospectus for general corporate purposes, which may include, but are not limited to, working capital, capital expenditures, acquisitions and repurchases or redemptions of securities. When particular series of securities are offered, a prospectus supplement related to that offering will set forth our intended use of the net proceeds received from the sale of those securities. We will have significant discretion in the use of any net proceeds. The net proceeds may be invested temporarily in short-term marketable securities or applied to repay indebtedness outstanding at that time until they are used for their stated purpose.
Ratio to earnings is nil, i.e. (1) For the fiscal years ended March 31, 2007, 2008, 2009, 2010 and 2011 and the nine months ended December 31, 2011, our earnings were inadequate to cover fixed charges. The coverage deficiencies were $36.7 million, $36.1 million, $41.7 million, $67.3 million, $38.3 million and $10.5 million, respectively.
BTW, where did you get the pricing breakdowns that you included in your post?
Finding the correct site proves there is no such thing as a dumb question; we all benefit. Thanks
Interesting article in the WSJ yesterday titled "SEC Probes Ties to High-Speed Traders" in which a trade called a "Hide Not Slide" is discussed. Basically, a Direct Edge customer selects a Hide Not Slide trade when entering an order to buy or sell. The order sits on Direct Edge's system only and doesn't transfer to another exchange.
If the order doesn't get filled immediately the Hide not Slide conceals the order at it's original price and displays a phantom order one cent away from the best price. The order doesn't execute at the phantom displayed price but maintains its place in the order book at the original price.
When the original price becomes viable the original order "lights" and is executed. The customer also collects a rebate from the exchange.
Direct from Direct Edge launches Hide Not Slide order
I think this could explain some of the odd behavior recently. What we see isn't the real deal, and at the moment EDGE has the highest bid quantity displaying on level 2.
Here's another "seasoundism" for you Capt'n--"When trading against the machines patience is a virtue."
Thanks Capt'n for the most informative post.
Yes, I am aware of the sequence of purchase orders, build out of the necessary infrastructure, and estimated delivery dates, etc. prior to receiving the Capstone unit. Do you know if their is a structured payment plan upon ordering a unit, e.g. something like 20% down upon order, X amount due at delivery and remainder at commissioning?
Also, not poo-pah'n the C1000 at all. With 2 in the que that's definitely a good thing. And no, I wouldn't want to see finished product stacking up on the shipping dock either. This company is most definitely a "just in time" production facility.
Believe me, with the belief, backed up with buku long shares, that I have in this company, my comments are in no way meant to bash Capstone. I think the month of March being comparatively lean on new orders, and the recent side-ways IH manipulated trades is just a bit frustrating. BTW, where did you get the pricing breakdowns that you included in your post?
Thanks again for your excellent post and dedication in making this one of the most professional forums that I've participated in.
"the company’s recent ability to work through backlog, increase margins and bank new orders have all been encouraging signs to move forward with."
If Capstone can work through the backlogs and make d,eliveries thereby generating income, it will definitely help the bottom line. Perhaps this lull in orders will allow them to do that and the next up-coming quarterly report will show profitability.
That being said we need to see continuation of orders announced to insure there is always a backlog to keep that 25% (and hopefully more) exiting plant production capability running. What we really need are several huge orders that will soak up some of the 75% idle plant capacity. One new order of a C1000 isn't going to have much impact although it is better than the alternative.
Slow action today but it is more of the same, i.e. 100 shares at a time by the flash traders, especially on the BATS.
Yes, I know of the potential and that's why I'm a long strong long. Just hope I can last. What is the saying? "The market can remain irrational longer than you can remain solvent."
Thanks for that chart Capt'n. Seems to me that the 2 sales of the C1000 isn't doing much for the share price though. Nasty market today across all asset classes. I suppose it was a good day to announce something in any case.
What I would like to see is our Japanese connection be re-established and Capstone penetrating that market with the C1000s.
Bid/Ask again about 5:1 (300,000 bid/60,000 ask) yet almost all shares being picked off at less than ask. ????
Looking at the shares being picked off a hundred at a time demonstrates that the flash traders are still in control as they seemingly have been for the last week or so. There is certainly a dearth of retail investors as well as news to move this stock.
As far as the "Whisper" concept car... getting the price of a turbine down 20 fold seems like a stretch, even if Capstone could put that spare 75% of idle plant capacity to work. 20,000 pounds sterling = $31812; 1000 pounds = $1591.00. I doubt the Chinese could perform this feat.
Let's see...one sticker printed on 4mil vinyl using water and UV resistant inks or 5 digital shares of Capstone. Would this be like a derivative?
With a 50:1 Bid/ask ratio it sure seems unusual that most shares are trading less than ask. Can someone explain this action?
I can agree with you on all points. I suppose key trade shows would provide the most bang for the buck. What I wouldn't want to see is more cash burned on top executive's salaries and bonuses without commiserate sales and profitability.
Looking at "Ask Management" one question asked on February 8, 2012 was answered in part... "In addition, Capstone is currently running at approximately 25% of its total plant capacity and has invested millions of dollars in upgrades in its current facilities." 75% idle capacity doesn't sound so good unless Capstone received a giant order, in which case the ability to ramp up quickly would be great.
What I would really like to see is the buck 40 mentioned by iheartwheimers in post 12080. Its been awhile for that recycle and I would be glad to take the trash out when it gets full. 2/3s of my position is core and the other 1/3 for the swing.
Saw the same thing here just before heading out to the garage.
After that last minute I'm with Lyoyd...going back out to the garage and bang my finger with a hammer.
Looking at the level 2 action this week it is fairly obvious that the computers are in control of the price. Watching the buy/sell you can see them being ticked off 1/2 cent (and less) in 100 share "blocks." I quote blocks for lack of a better term although I realize a block is 10,000 shares. This controlled walk-down has been especially obvious this week. JMHO and believe me, that is all it is. I rely on the Captain, Gene, and Wild-Bill for the real numbers.
Another good find on IV by jesinternational
Horizon Power Systems Presentation
Although from last month I don't recall seeing this particular presentation before. Highlights Capstone's capability very well.
That sounds like a plan--eyes on! Things sure have been quite since the last CC
Thanks to yormom over at Investor's Village for this:
From BPC Russia
http://www.bpcenergy.ru/press-center/press-release/3224/
Microturbines provide power elite residential complex in the center of Sochi
Press release
March 27, 2012
The company "BPC Engineering" has started commercial operation in the energy center on the basis of Capstone microturbines in the residential complex "Sea Palace" in the center of Sochi. Today it is one of the best contemporary architectural sites of the city, which took the prize in the competition of architects of Russia. It is a luxury apartment building with sixteen monolithic bearing walls, located in the cultural heart of the resort city of Sochi. From almost every apartment has panoramic views of the Black Sea, Sochi Sea Port, Lenin Park and other attractions.
Microturbine energy center is located in the basement room of the main building and fully meets the needs of the residential complex for electricity, heating and hot water. The composition of the main technological equipment includes four C65 Capstone microturbine installation of heat exchanger, two hot-water boiler Viessmann. Microturbines operate in standalone mode on the main gas. Their combined power capacity of 260 kW thermal power - 470 kW. Additional redundancy is provided by the urban network, which is used to cover peak loads. In this project the BOC Engineering has supplied the equipment, installation, commissioning and training of customer personnel.
With the construction of a residential complex the developer has set a goal to use only the most modern and high quality materials and technology. Designed to provide maximum comfort for its occupants, "Sea Palace" has a fairly advanced and energy-intensive infrastructure, including underground and above ground parking, elevators, swimming pool, professional gym, restaurant, bar and a cozy patio. Due to the frequent interruptions in the supply of electric power characteristic of the Sochi region, to the equipment subject to special requirements for the degree of reliability and environmental friendliness and low noise level, because the object is located in a densely populated center of the resort town. How to best satisfy all these requirements as a basis for energy center were selected microturbines Capstone. Their high reliability due to a number of design features that are protected by more than 100 patents. The use of air bearings in the construction of micro-eliminates the need for oil and coolant, which greatly simplifies and reduces the cost of maintenance of equipment. This was an important factor for choosing microturbines, since the object is not assumed constant presence of staff. In addition, the flexible microturbine to the load and can operate in a range from 1 to 100% without loss of efficiency, which is very important for a residential facility with a significant daily fluctuations in energy consumption.
Given that the microturbine energy center is operated in cogeneration mode and the total efficiency can reach 90%, for every kilowatt of electricity produced by shareware 1.8 kW of heat. Therefore, the cost of electricity is only 1.8 rubles. per kW · h with existing network tariffs in the Krasnodar region of more than 3 rubles. This reduces the utility bills for tenants, while maintaining high quality services that meet the requirements of luxury homes, and also provides additional benefits of the residential complex real estate market town of Sochi. "Sea Palace" - this is the first large-scale residential facility in Sochi, where he organized a highly efficient and environmentally friendly self-contained power supply with the use of microturbine technology. Already, he is a model of comfort and energy efficiency. Currently, the completed painting and decorating the house, and in the end, he will be ready to accept the first tenants.
109028, Russia, Moscow, ul. Ground Val, 50A / 8, page 2
Tel.: +7 (495) 780-31-65 Fax: +7 (495) 780-31-67
Copyright © 2005-2012. BPC Group. All rights reserved.
I agree totally. Of course I realize that advertising by itself can't sell the product. Knowledgeable employees who know the product, and have the vision on how Capstone products can integrate into large scale projects, are what you need to meet face to face with architects and engineers at the firms who design and develop data centers. Perhaps that is what Capstone has in mind with this solicitation that I posted earlier.
Strategically placed adverts are required to bring attention to new solutions and "thinking outside the box" so to speak. If the architects and engineers don't even know about the product why would they call upon Capstone's manufacturing representatives and distributors in the first place? Capstone, IMHO, should blanket all pertinent trade publications with their name, their product, and their solutions. Knowledgeable Capstone experts should attend every key energy expo and be prepared to not only answer questions but to offer up solutions.
Think about this...everyday media is bombarding the general public with adverts concerning natural gas. Two years ago you never saw an advertisement about natural gas unless it was something local, or about a particular tax rebate available if the consumer switched appliances to natural gas. These ads are being placed by America's Natural Gas Alliance and in a sense have at least made most Americas aware of this "newly" abundant domestic energy resource. You might ask "who are these adverts being directed towards" and I would answer "the electorate." The whole idea is to get the nation onboard and start using this resource, whether it be Boone Pickens' 18 wheelers, power utilities, or eventually automobiles. Of course a strictly self serving reason for this advertising campaign is to get the price up and silence the anti-fracking folks. Rig utilization is down and wells are being capped due lack of demand and low prices....but I digress.
Heck, I would even go so far as to recommend that Capstone put together a 30 second spot and air it several times a day on CNBC. Natural gas is all the talk there right now (due record low prices) and I can guarantee you that if we don't start using that cheap gas domestically it will be used overseas. This is prime time for Capstone and they need to take advantage of the chatter while its hot.
"This site is vastly larger than the Syracuse data Center." It wasn't my intention to debate the size of the data centers, my posting was to illustrate the potential market for Capstone.
Currently medium speed DG (Diesel Generator) sets dominate both the stationary power supply market, (whether it be data centers, emergency back-up power, hospitals, mining, etc.) and the mobile market, i.e. locomotives and standby power in marine applications. The upper end of these applications is 3mw (can you say 3 C1000s?)
With NatGas currently trading at $2.20 per mmBtu at Henry Hub there is a great incentive to move to natural gas as a fuel source due the fuel price spread alone (pundits are now talking about $1.85.) Diesel fuel requires treatment with biocides which in turn presents its own problems, as those dead bacteria have to be filtered. On the other hand natural gas arrives at the end user site perfectly clean, cheap and abundant.
Another issue with diesel generators is compliance with EPA emission standards, which are only going to get stricter. The US Clean Air Act requires that new source performance standards (NSPS) be established to control emissions from new stationary sources [CAA, Section 111(b)]. One caveat of this is the use of natural gas for use in diesel propulsion is rapidly gaining traction. That being said the Capstone solution having one moving part, no lubricates, filters, etc. is still a winner in my opinion.
Again, as to sizing of gen-sets it is a simple issue of synchronizing, i.e., install as many as required to achieve the desired output in synchronous operation. I haven't a clue as to the amount of power required to power 25,000 households btw.
"The article doesn't state the size of the diesel turbine" I presume this is a nomenclature typo, as I know of no diesel turbines, and assume you are referring to gas turbines which use diesel as a fuel source. This is a whole different animal. Gas turbines of course have many applications including stationary power plants. Unless they are configured in a combined cycle set-up they are only 35-40% efficient. In a combined cycle they can obtain 60% efficiency, but these babies are expensive. Need 400mw? Call GE and have them build you a turbine.
All of the above being said I think the roll out of the C1000s is the key to Capstone's profitability.
Visa Stores Data Like Gold: In Its Own Fort Knox
Diesel generators onsite have enough power Relevant Products/Services, in the event of an outage, to keep the center running for nine days. They generate enough electricity for 25,000 households.
Really too bad that this facility didn't go the Capstone route as did the Syracuse Data Center, especially considering the tri-generation factor. It would seem a no brainer to me. One would hope that Capstone is purchasing Ads in the Data Center trade rags--using some of that recently acquired diluted cash to drum up some business.
What this stock needs right now is news of new orders. After such a flurry prior to the last CC it seems that we are in a lull. Of course, the lack of news making deals will help whittle down that backlog, but it's always good to have some dry powder in storage for a rainy day.
Off 3 cents now, which seems to be a reversal of the last few trading "end of day" pattern. What we haven't had since the last CC was any news about new orders, except perhaps the C100. We need to start seeing more sales.
Ditto on your post. The late pile on is unusual, but at the same time one must ask "if there is information out there why wait to the last 30 minutes to start buying?" Wild Bill oftentimes stated it was "painting the tape." Keep on painting is my position.
From the linked blog:
"Rubicon has been a major disappointment yet highly paid chief executive Luke Moriarty remains entrenched after eleven years in that position and three of the five non-executive directors have been on the board since early 2001.
Why do the chief executive and directors of such a poorly performing major company have such long tenures? Do Rubicon's shareholders have any ability to initiate badly needed changes at the company?"
Makes me wonder also when promises are broken, i.e. "no further dilution seen as necessary; profit next quarter, accounts receivable issues..." all the while pulling in a million smackers. Cut that by about 90 percent and we might show a profit.
Maybe if Mr. Duprey will watch the link in my post 11988 and post to the Fool the Fool's will buy in.
Nice 3 cent move in the last 30 minutes of trading today :)
Just reread "Formatting Hints" and it makes some sort of sense. I'll try again here. Cheniere CEO Souki says U.S. could see $2 natural gas
It works! Good interview about the future prices of natural gas.
Double edged sword with NatGas heading towards 2 bucks. Exporting Natural Gas Would Be Very Profitable For North American E&P Companies. As the price declines less wells are drilled and more existing wells are capped. What does this mean for Capstone? I would suggest that the slowdown in drilling may impact their recent order rate for C65s although many drillers are shifting their focus to oil plays. A pretty good view of the current trend can be seen at The Haynesville Play and other rig utilization sites.
Because of a supply/utilization imbalance in the US the Henry Hub front end contract for natural gas is around $2.25 per mmBtu and is expected to continue downward. This supply overhang is expected to continue for years to come--Cheniere Energy CEO: Shale Gas Industry 'Very Early in the Learning Curve'
Japan has shifted a large portion of their energy production from Nuclear to natural gas. The current rates for delivery of LNG FOB (Freight on board or Free on board) to Asia has just exceeded $16.00 per mmBtu
Jamison said in a CC last year that due prior missteps in the Japanese market that they, Capstone, are having to rebuild that market. I suggest that there will never be a better time to start pounding nails than right now--start aggressively selling the C100's to Japan to meet their urgent needs for distributed power sources. Capstone is a natural play for a country which is undergoing a cultural shift in the way it produces and distributes power.
Sorry about the hyperlinks not displaying correctly, but I did insert the url between the url brackets and the same with the text between the "tag" brackets. Any suggestions?
40 years ago MITI (Ministry of International Trade and Industry) in Japan made the decision that Japan would generate the bulk of it's power with Nuclear reactors. Natural gas was relegated to a minimal position in the country's power generation structure.
Subsequent to the tsunami, and the Fukushima Daiichi incident, Japan's nuclear output is down 95% and the focus has shifted dramatically in favor of natural gas. The opportunity for distributed energy sources, e.g. Capstone, is stupendous. I keep awaiting the announcement that Japan has ordered several shiploads of C1000's, as in my mind that is the most logical and quickest way to get the grid back up.
Japan has been the largest importer of natural gas for decades and now it's thirst for more is insatiable. Currently destination prices for natural gas to the Far East is nearly $15.00 per mmBtu. Japan is already seeking approval from the US to import more LNG as a May nuclear free Japan is looming rapidly.
Don't remind me about WPRT as I was in and out of that one at $13 and bailed as the NatGas act faltered. Closed today at $44.50. I'll give you one guess as to where I moved that portion of my portfolio...like a stone around my neck and can't get it off.
I too wonder how Jamison can command a million dollar salary without turning a profit.