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"3-D printing's growing at 24 percent annually, but it's missing a critical item." .....and we are all to believe that the critical item that is missing is SGLB's solution for in-process quality control. This statement by the man who has had a "solution" available for over two years now but has been woefully inadequate in introducing it into the market. I'm to the point where I believe almost nothing that comes out of Mark Cola's mouth.
The conference call is six weeks from now. Unless they are paying employees with stock or IOU's they are going to have to have a share offering prior to the conference call. I don't have hardly any skin in this game any more but if I did I think that I would try to force them to have an early conference call. The days of talking about "lockstep" have run their course and they either have significant orders that are imminent (like within 30 days) or they don't. In any event they are going to be forced to raise funds via a share offering of some sort. Stockholders are entitled to know the order status now, not after their shares have been diluted by 50%
Jeff, in my opinion they have been holding off issuing new shares in the hope that they could announce some positive news at the same time. I think they have a very good idea what will happen to the share price if they try to raise 10 million dollars with nothing positive to bolster the price. At this point they must be running on fumes unless there was an awful lot of transactions in the quarter that we are not aware of. News or not, they are going to have to raise money if they want to stay in business this Q.
Yes, interesting comment. The idea, after all is to make money on your investment, and equally important, not to lose (even more) money on your investment. SGLB is completely out of funds at the moment. They will have to dllute shareholder value (and almost certainly within the next week or so). They are not credit worthy and a loan is not a possibility. So they will be issuing more shares (and according to the S-1, shares with warrants attached). Don't listen to those who are telling you that sophisticated investors are going to be paying a premium for the new shares. That simply is not going to happen. The decision at the moment is whether you believe that Mark is going to make an announcement within the next few days of a major contract award or whether the company will be forced to dilute without the benefit of strong positive news. In my opinion shares will lose a minimum of 25% of their current value and more likely 50% if there is no off-setting good news to the share dilution.
The dilution is a sure thing, the good news, not so much.
As i understand this "option" a host of companies including GE and Honeywell who have been testing Printrite for the last two years (but have never integrated it into their production schemes (let alone paid full price for the software) are going to band together and support Printrite as an industry standard for in-process quality control. No harm in dreaming, I suppose.
"I believe that things will be dead silent, then lightning bolts will come out of the sky." You and I at least agree on this much.
"Will new warrants get issued if the S-1 offering is implemented?" SGLB is flat out of money as we speak. New shares will be issued. I suspect that warrants will be issued as well. An additional sweetener will be required to get anybody to buy. Even with the warrants (and assuming no major contract announcement in the next few days) shares are going to be offered at bargain rates in order to attract buyers. If they are still intent on raising 10 million dollars the share offering will have to be substantial
With all the positive speculation about the possible benefits to SGLB as a result of the recent flurry of activity in the overall 3D printing space I'm surprised that there isn't more discussion about an upcoming event about which there can be no speculation and that is the absolute requirement for SGLB to raise revenue. They almost certainly will run out of cash this quarter, perhaps within days. Some believe that they will be able to issue stock that will be well received by an investing public that is tuned into the future potential for SGLB in the marketplace. My personal belief is that a further dilution of shareholder value without the benefit of a major contract award will be catastrophic for the stock price. This issue deserves further discussion and the airing of the pros and cons because the dilution is a very near term event and it is going to dramatically affect the stock price in one direction or the other. All of the talk of being in lockstep with GE and evaluation sites being in contract negotiations are rapidly coming to a head. Time is getting short for Mark to pull a rabbit out of the hat.
Silver. Your faith in the future of SGLB is quite obviously sincere and admirable. However, when blind beliefs start to affect rationale judgement it's time to take a step back for a second look. SGLB is running at a quarterly expense rate of $800,000 with only $550,000 cash on hand at the close of Q-2. While hopefully their revenues picked up some this quarter they are clearly operating on fumes at the moment. What are the odds (after all this time) that a significant contract/revenue announcement is going to occur in the next week to ten days? That is the time frame that is necessary to spare them from an absolutely disastrous share offering, and kill any chances for a NASDAQ upgrade. If they are forced to issue shares without a contract announcement, which becomes more likely by the day, the stock will be trading sub $2,00 in a heartbeat. The share price will take a hit from which it may never recover. I don't like those odds, and as a rationale investor neither should you.
Last quarter their expenses were $800,000 and cash on hand was $550,000. Even with the announcement last quarter that there was additional income pushed over into Q-3 they will have to be having a bang-up quarter to keep from running out of money. I believe we are going tyo ha=ear about a public or private share offering in the next ten days or so.
There is no question that this has been disheartening on a number of fronts. With the increased volume today, more and more shareholders are seemingly deciding not to wait any longer for positive news to come to the rescue.
It is certainly possible that Mark has a major order/contract in his pocket that will allow for an additional share offering at a good price and facilitate the upgrade to a major exchange. I'm in agreement that he has been "signaling" that this is the case for some time. September is put up or shut up month however. The money will run out and there is either a significant order to support the issuance of shares or there is not. In either event the share price will be far removed from todays closing price.
"I believe it will change, HIIGUY, when we are on an exchange in which a whole different kind of investor can dig in and read between the lines at what the story is."
Silver, I'm not sure where you got this idea but it is certainly contrary to my observations and experience. OTC investors are far more willing to take risks on undercapitalized long-shot stocks than are seasoned moneyed investors who avoid the OTC and concentrate on investing on the major exchanges. The idea that this new set of investors is going to "look behind the curtain" and visualize gold at the end of the rainbow is simply wishful thinking. They are far more likely to look at the number of "evaluation sites" with no significant orders over a full two years and come to the same conclusion that the current investor base has...."something is seriously wrong here". We will all know who is correct very shortly here because new money is going to be required this quarter. The idea that (absent a major contract or order) SGLB is not going to take a terrible beating in any share offering has very little credability in my opinion.
"So it is a relative thing to say that the offering has fallen flat. Fallen flat for whom; SGLB, the underwriter, or the common shareholder? It won't be all three." I can pretty much guarantee that it won't be the underwriter who takes a hit, so who does that leave?
Silver. As I read the S-1 it seems clear that it is SGLB's assumption that the upgrade will occur prior to the share offering. I did not see anything in the S-1 that "required" that to be the case and that is why I asked the question. SGLB can make all the assertions in the world about future orders (that is getting pretty old at this point). If those orders are not announced and firm prior to the offering (whether or not they have successfully upgraded) the offering will fall flatter than a pancake. You can only promise orders so long. At some point you need to deliver, and that time is now.
Ted. It's clear from the S-1 that SGLB's intent is to upgrade to the NASDAQ Capital Market before issuing shares. However, what happens if they don't qualify to upgrade (they don't at the moment) but obviously still need the funds from a share issuance? Is your reading of the S-1 that it is only valid if they are able to upgrade first? I had not linked the two events together like that, but in re-reading it I can see how that might be true. It would seem to me that whether or not they qualify for the upgrade they will still need the money. Can you clarify that for me.
Yes, it's clear that they are going to issue more shares. The unknowns are : when? (almost certainly this quarter) At what price? (would seem to depend upon current share price at offering and positive news, if any) effect on existing share price and ability to upgrade? (dependent upon whether positive news or not).
I don't know about 50 cents, you may be correct. However, SGLB has a much more immediate problem this quarter. They will run out of money and will be forced to have a share offering. If they dilute without the upside surprise of a major contract/order the price will be sub $2.00 in a heartbeat and all chances of upgrading to the NASDAQ Exchange will be out the window. Not only will the additional shares hold down the share price but the attached warrants will worsen the effect. Given their expense run rate the share offering would seem to be a certainty. If I'm missing something here please enlighten me.
The optimist proclaims that we live in the best of all possible worlds; and the pessimist fears that this is true.
That's right Jeff, his account certainly is green (very green, even at today's depressed prices). At $2.38 a share it's worth better than $800,000. What makes it even more sweet is that he didn't pay for a single share. That's right Mark, nor the rest of the senior management team, nor any of the Board members have EVER purchased a single share of SGLB on the open market. It has all been awarded through the company programs. With profitability just around the corner, one would think that just maybe a few would step up and buy some stock on the open market. Just one more indicator of how credible Mark's assurances are.
Kanya, because SGLB is local, and I want desperately for them to be successful, I spend more time here than I should. I'm not an engineer, but I had a long career in high tech sales and marketing with some highly successful and competitive companies. I have also been involved as both a principal and a board member on two high tech startups. I've attended two of the SGLB Board meetings and come away highly disappointed both times. My honest opinions, which run counter to most here are as follows:
Mark has shown very little interest in his stockholders. He may be an extremely skilled scientist (I'm not qualified to judge), but has made a number of poor business decisions which have been costly to the company and to the share price. The Board has been a non-entity, at least to date). Hopefully that may be changing now.
Mark has been allowed to operate the company with a free hand, as more or less a sole proprietor (going so far as hiring his wife in the number two position with a generous salary and benefit package). Rather than focusing on sales and revenue Mark seems to have focused on recognition within the industry, both personally and product-wise for his scientific achievements. The excuse that the industry is not ready for software that services a mass production environment is wearing thin after PrintRite being available for two years now, and a number of players clearly commencing large-scale metal printing production. Once again, I'm not qualified to judge but it does make one question whether after all the testing and evaluation that has gone on, whether PrintRite's price point justifys the benefits to be derived from it's use.
As to how i can help. Mark is clearly not interested in my input (we've had some heated exchanges at Board meetings). I'm going to continue to raise my concerns here, and to the extent that others agree, perhaps pressure can be put on the company to become more shareholder friendly. A step in the right direction would be to bring in an experienced high tech business manager to become the C.O.O. freeing Mark to focus on the technical issues and his Board responsibilities.
I understand that my views differ considerably from your own, but you asked and I tried to provide an honest response.
Max, why worry, just look at the numbers. Let's see, they have carry over losses from Q-1 and 2 of $1.2 million. Their expense rate is now running at about $800,000 a quarter and let's assume that remains relatively constant throughout Q-3 and 4. In order to show a profit in 2016 they would need to have a gross profit in the last two quarters of $3,000,000. That's only 10 times the gross profit that they earned in the first two quarters (remember this is profit and not revenue). Is it possible? Sure it is with some very major orders. Does it appear probable at the moment? You be the judge, it's your money.
Well Dawson just show me the money....that's what I have to say. What a bunch of crap highlighting accelerated sales in Q-4 2015. Just forgot to mention the most recent quarter's results. Pure puffery.
Pisdl: You are exactly right. There should always be a published price list for every product. If you want to purchase one unit that is the price, whether you are GE or some much smaller enterprise. If you want to purchase one hundred units then we will talk price with you. However when you come back next year and purchase five more the price for those units is the published price. When you start negotiating different prices for single orders you simply antagonize your customer base. Everyone is certain that someone else is getting a better deal and the customer has no firm basis for evaluating whether the product adds sufficient value to pay the asking price. Not having a firm fixed price at this stage of the game smacks of desperation on the part of SGLB, i.e. at what price can I entice this customer to take my product?
I'm certain that Mark heaved a huge sigh of relief that there were no questions....there could have been some very tough ones. Pretty amazing that no one asked any. I think a partial reason may have been that the overall call was so brief that listeners were caught a bit off guard that it was over so quickly and did not have time to formulate their questions. Mark should be very pleased as well that the stock did not sell off to any great extent. The next few days will tell the tale on where the stock price will settle.
Driftin: Agreed. Where we likely disagree is that I believe SGLB has a very short window in which to either be recognized as some sort of standard or have GE or Honeywell come through with a sizeable order. The Q-2 results are going to make qualifying for the NASDAQ Capital market more challenging. The $3.00 closing price will be difficult to achieve unless we get some better news quickly. What's even more serious is the impact that a new share offering, without the benefit of some very positive news, will have on the share price. Mark has seemed to signal that he is confident that significant good news is on the way; the CFO hiring, the upgrade, the share offering, all would seem to suggest that good news is imminent. He didn't manage the reverse split very well however. Let's all hope he learned his lesson.
It's rare for Silver and I to agree on much of anything but I am in wholehearted agreement that the next 6-8 weeks are going to be chaotic for SGLB. On the plus side is the announced intention to upgrade and the new director selections. The share offering is only positive if the price is right (and Silver and I differ on whether an announcement of major contract / orders is necessary for that to happen). If you are a substantial shareholder it's not too early to map out your strategy now. Is it a good thing, as Silver suggests to help prop up the share price so that SGLB is assured of having a closing price no less than $3.00 so that it qualifies for the NASDAQ Capital Market, or should you start shedding shares now in anticipation of the share offering where you can buy the units? If you are a believer in the longer term future of SGLB the units would seem to be the better buy than the naked shares and if there is only a modest premium to purchase them you would want to have the maximum amount of funds available. In the worst of all scenarios whereby SGLB does not maintain the $3.00 closing price, there is no major contract announcement but the share offering goes forward (they need the funds, so I don't see much option here) the offering might come off at prices lower than todays. In that event you would have funds to purchase the units if you continued to believe in the future prospects, or you could choose to sit on the sidelines, being at least some money ahead from your earlier sale. Regardless of how you predict how all these events might gell in the next few months, now is the time to think about your options and not after one or more events have taken place and any options have evaporated.
It would have to be an unscheduled material event. Individual sales would not qualify however a multi-year contract with GE or Honeywell certainly would. There is lot's of grey areas between these two examples that might qualify as a material event as well.
The backgrounds do look like just what is needed. O'Mara's background is ideal as well, but he never made any effort at all to get involved. Let's hope these guys function as a real board should.
A letter of intent (if it was specific enough) would certainly satisfy me.
The obvious fallacy in this thinking is that Mark is the one who set the bonus targets. Hard to imagine anyone who has been worst at setting and meeting targets. I don't believe that the targets represent much more than wishful thinking on Mark's part and we all know how accurate that has been.
Silver. The only thing for certain is that we will all know the results before August comes to a close. For your sake, and the many others who feel similarly, I sincerely hope that your view turns out to be correct.
Jeff: Where did you find that video? It's from about ten years ago, Forbes Magazine took to promote their book. I shudder when I view it now. My investments in Chinese small cap stocks was largely a disaster, that I am still recovering from. Investment fame and fortune can be fleeting.
Ted: It's not so much the dollar size of the order but rather substantive evidence that SGLB is going to play a leadership role in quality assurance for the metal printing industry. A commitment by GE or Honeywell that SGLB technology will be a standard fror them, or simply a large long-term dollar order would be nice (5-10 million would certainly turn my head)
Silver. I sincerely hope that you do make it to Albuquerque sometime in the near future. It would be a real treat to have a beer (or several) with you and see if there is possibly anything at all that we can agree upon (other than the fact that we have some outstanding micro breweries here that I'm certain you would enjoy). One would think that two relatively intelligent people looking at the prospects for a security would find something (anything) to agree upon. When I read your postings I wonder whether we are even discussing the same stock. You appear confident that an uplisting to the NASDAQ is going to bring in a host of institutional buyers. I'm doubtful that they will even have enough subscribers to satisfy the offering. Without a major contract/sales announcement this offering is going to have to be priced at bargain rates to get anyone at all to purchase shares. The offering is yet another dilution of shareholder value without a clear path to profitability. I'm beginning to feel more and more certain that there will be no "carrot" of a major order or contract to accompany the planned upgrade. Any order of this significance cannot be "sandbagged" to the 12th of August. The SEC requires prompt disclosure and we would be aware within a matter of a few days.. We know that there were no "significant" orders/contracts in Q-2 because they would have had to announce those as well. While I sincerely hope that I am mistaken this "upgrade" is shaping up to be another disaster for shareholders orchestrated by an unbelievably naive Mark Cola who needs to have the management reins jerked from his hands and placed with someone who knows how to run an enterprise.
The choice is dependent upon your longer term outlook for the stock price. Just to make things simple assume that the stock is still trading at $3.00 when the offering comes to market. The units will be priced somewhat higher because of the attached warrant (let's say $3.20). If you buy the units you will have the right after six months to purchase an additional share of SGLB for $3.84 (a 20% premium to the offering). I didn't notice, but there is likely an expiration date on the warrants, after which they are no longer valid. Your decision then is it worth it to pay an extra .20 to buy SGLB at $3.84 in the future. Keep in mind that if for some reason the price of SGLB does not exceed $3.84 in six months you would be better off simply buying additional shares on the open market. The longer the warrant is valid the more valuable it becomes. If there is a major contract announced, or you believe a new contract is inevitable in the near future, than the units are clearly worth the small premium. My numbers are just an example, you can plug in your own numbers and make your decison.
Silver: Never ever happen with sophisticated investors. No sales, losses every quarter since it was in existence. They will not touch SGLB with a ten foot pole and the price is going sub $2.00 in the blink of an eye. Surely Mark can't be that stupid twice in a row!!
In my opinion the success or failure of the S-1 Registration all hinges on the presence or absense of a substantial order or contract. One that firmly establishes SGLB's credibility in the marketplace and reassures investors that SGLB is going to have a leadership role in quality assurance for the metal printing industry. All signs would lead one to believe this is the case. The engagement of the CFO, the uplisting, the new board members, etc. all point in that direction. If the order/contract meets this criteria then SGLB is surely off to the races and won't look back. Shares purchased today will likely be wildly profitable in the near and longer term. However, if this is another boneheaded move by Mark where he mistakenly believes that he can further dilute shareholder values by issuing additional stock based only upon his continued insistance that SGLB continues to be in lockstep with GE (without orders or contracts on the table) the offering will be an unmittigated disaster that the stock price may never recover from. Let's all hope that Mark learned his lesson the last time around when his ill-advised actions caused the stock price to crumble.
Exactly the same. You say premium, I say discount. They will trade at different prices.
Can someone please outline what criteria SGLB meets to qualify for A Nasdaq listing. I know there are multiple options, but I simply don't see it. Thanks.
Silver I disagree. The warrant does not have to be in the money to have a value. Given the choice which share woiuld you rather own: one that gives you the right to purchase shares at a 20% premium to the issue price in the future , or a share with no rights attached. The price differential is going to be based upon shareholders evaluation of what that future right is worth. If you believed that shares would be showing significant appreciation in the future that warrant would be a very valuable commodity.