is... a buy and hold investor of dividend US and Canadian stocks
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It has been awhile since I looked at the last set of financials, but when I did, I figured they would be out of money by Xmas-time, and certainly in no position to be erecting more processors.
Why would the companies take their orderÉ I don't think there are any orders. I doubt that any companies would even waste time and effort quoting them. There was a loose statement in the last financial statements about having ordered equipment. That is a bogus statement, anyw ay y ou look at it, and just intended to raise false hopes. You don't order equipemnt unless you are actually going to do something. They have not announced firm plans for another site, so it is meaningless.
I think there is something under the surface that we don't know about to do with the whales and KR's appointment. I don't know what it is, but I think there may be an announcement in the new year that wil reveal the true plan, and the disposition of the company's assets. I think that Rauber was just checkin' them out...
Just wonderin'
I wonder how they intend to pay for them? Or pay for erecting more P2O units? The processor is only a fraction of the cost.
i need to do some research. My experinece with these kind of companies is that although they may be very well-meaning and the idea might be great for the environment and all, it just never turns out to make economic sense. Yes I would love for there to be afleet of energy-producing buoys in the ocean providin gfree power. But what about the capital cost?
Do you have any more info on the Lockheed connection?
Hi. New to this board. I saw this on the news some time back and thought it was really neat. It would be a great technology if it could actually work, and work profitably. One of those things I was tempted to buy, then held myself back.
What is the upshot here? I don't generally buy companies until they become profitable.
Is there a business case for this? Profitability analysis?
I think that all he is trying to say is that regardless of any eyewitness reports there might be, the optimism in the reports has not been reflected in the filed financial statements. There is not way that anybody can assess the profitability of JBI by sitting by the plant and observing the number of tankers leaving and doing any kind of math. We don't even know whether their mode of operation is even effective or if they can be profitable. The cost claim of $10/barrel has only appeared on message boards, I believe. Or, as an offhand statement that the CEO/ CTO cannot be held accountable to.
So what you reported from the field can be perfectly "true" just not worthy of the optimism generated, as reflected in the filed financial statements.
I took a look at that last set of financials just recently... man... it is going to be pretty hard to reverse that trend for JBI. CFP next (hind) quarter? WPF...
You know that that data is not accurate...
Let's not talk that way about Pat... he was a good guy. A winner. I met the Hulls some time back... cool. My point was that any talk of Naked Shorts having anaything to do with JBI's stock price is hogwash. In a pig's ear.
Steady:
The whole Naked Short thing is a bunch of hogwash.
Actually neither the SAIC repot or the leaked Summary mean anything, as evidenced by the company PR, which advised not to rely on it.
Does not mean a thing. We have no knowledge that JBI has a contract with US Steel or is sellign anything to them.
btw, if you are going to put these quotes in, you should be careful that they at least make grammatical sense.
"That’s a number six fuel, that’s what a lot of what US Steel uses,..."
I am sure he could not be quoted on that because it makes no sense. What he said probably at least makes grammatical sense.
Why? Based on the post, there is no proof that JBI is selling anything to US Steel. It is exactly what the Response said, conjecture and hearsay. Having it mentioned in another post is not 'proof' of anything.
The "estimated gross number" for the cost/ barrel for JBI is based on an EBITDA number which came out of thin air, with no backup, and which is not been legitimized or formally released by JBI, and certainly not proven in results. Since it is based on nothing more than a rumor or a "leak", it is a wild-assed guess at best.
I don't think so... JBII's competition is relevant to the "business prospects for JBI", which is the subject of the board.
nothing. (in answer to what do i expect them to say..)
I would not say "cut-and-paste" but implausible. It actually reads fairly well. This is a short list of what is implausible in the document:
- it is too late in the development of the technology for an order-of-magnitude estimate to be applicable.
- an audit is not the right word to use for this kind of analysis. An audit is imply an exercise to make sure a process meets a standard or to assess what is there.
- a 3-day trial does not fit with an order-of-magnitude estimate or even with this kind of analysis. It may validate assumptions of a much later stage of analysis.
- The EBITDA number is completely without basis and not applicable to JBI. JBI has no Amortization, does not pay interest, and that figure does not even appear on it's balance sheet. No assumptions are stated, which they should be.
- an accounting number is not applicable to the kind of analysis being undertaken. An ROI or NPV analysis would be appropriate. Both of those rely on a summation of the discounted positive and negative cash flows resulting from the construction, commissioning, and startup of the plant. Basically, a project should go forward of the resulting ROI is greater than the hurdle rate. Given a hurdle rate of 10% (Cost of capital) for JBI, 20-25% may be a reaosnable figure.
There is no basis for the EBITDA number in the so-called SAIC report, hence there is no basis for any conclusion drawn on that, including the $10/barrel figure.
Confidentiality is a good thing. Maybe people are just minding their business.
Cowards? Hardly. Have you ever formed an opinion that a stock was going to go down or was not a good investment and sold it? Fact is, buying is much easier than selling. Anybody can buy a stock and have absolute faith in it, and hold it forever. It takes courage to sell and move on. Lokewise, to post a negative opinion.
Message boards provide a forum, via anonymous identities, to do that, that is all. The message board is disseminating the information, not the poster. I don't discuss stocks with my friends because I could steer them wrong. It is very personal, so this is about the only way I can discuss it with anybody.
I don't know... there are two sides to everything.
Has anybody considered that the court action is not over yet?
Being told not to discuss JBI is a fairly slight slap on the wrist when you consider the other potential outcomes. Financial ones, for example. Maybe the judge simply felt that spending one's time on the internet seems to be a waste of time and causing trouble so he ends it. Maybe he does not post in the internet, being "old school". That is tantamount to saying, "stop fighting kids!!" to both sides. I don't think that not being able to post on a message board should ruin anyone's day. And since the judge did not bother to hear the case, he/ she did not think it worth the court's time.
Has anybody considered that perhaps there is a counterclaim that is not completely adjudicated yet? That is the way lawyers usually operate. Claim? Counterclaim!!!
Both arguments would be heard at once and the judge would give his verdict on both at once.
What is really interesting, and I can speak with personal experience at this, is that the judge will address the "winning" party first. That is to say, it will appear as if one side has lost when in fact they have won. The judge will usually see whatever merit is in both sides. No matter what the defendants have done or not done, they are not totally without blame. Hence, even though the defamation case may be essentially without merit, the judge may admonish the defendants first.
I have seen this in a courtroom. The Judge will address one side and one would think that they had lost the case. But, then they will tear apart the other side, and award the case against them. Damages are given as amounts for both Claim and CounterClaim, with a balance payable. Court Costs, Damages, and Punative Damages are awarded for Claim and CounterClaim.,
But... then he will address the counterclaim. For all we know, this is ongoing as we speak. What has transpired may just be a slap on the wrist intended to prevent further harm coming to anybody.
The wording of the Judgment seems to leave this an open possibility. Maybe the original Claim has been dismissed, the CounterClaim... not! If this is true, the original Claim has been dismissed with no damages assessed. I would say that is a victory for the Defendants.
There are many things that are suspicious about that Summary. First of all, it is only the most basic estimate (Level 1 or "Order of Magnitude"). That means it is accurate to something like +50/ -40%. That means the true cost could be anywhere from $10M to $4M. It does not make sense that they would be so vague now. It means that they have not been doing these kind of estimates, which implies that the system is undocumented, and hence not able to be easily commercialized. I am jumping a bit, but in order to build the processor you have to be able to have a document package (set of drawings) to deliver to a contractor. I get the impression that is is something that John and his crew have been toying with for years now. With no documentation, that is useless.
FUrthermore, as the estimate is more refined, it tends to increase in magnitude. It should not... but it does. The Level 5 or "definitive estimate" is always higher. At that point you have a fully documented system with a full drawign set.
Most importantly, you can't just jump from a few production figures to EBITDA. There was nothing mentioned about the assumptions for SG&A, which are included in the calculation of EBITDA, and other costs.
There should have been statements about the Basis used, such as at the very least the pricing assumed for the product. They should have said something.
All that results is that the reader has to make their own assumptions and put it together, which is why we are still talking about it.
It is very suspicious, and for the company to come out with the statement they did, that it was a real document, only makes it more incredible.
One last thing... when was the last time the term EBITDA was used on this board? I used it a coupel of weeks ago. You will find it does not apply to JBII. They do not pay interest, and have no AMortization. You will see it does not appear on their I/S. WTF?
Someone do a Board Search on the term "EBITDA". I am curious how often it has been used up until now. I would not be surprised if I was the first person to use the term a couple of weeks ago. I am a Free member, so I cannot do a search.
Plausible Deniability. JBI has in effect released the report. but cannot be held accountable (if they are indeed up to some funny business!) The PR following the report made it clear that it was the real deal. Therefore it should have given impetus to the stock and potential investors should be able to rely on it. However, due to the disclaimer ont he PR, JBI cannot be held accountable. Typical of the information we discuss on this board.
I am not accusing anybody of anything, just making observations. Maybe there is another version of the report out there that JBI is referring to in it's PR, maybe there is some confusion in IR.
What is interesting is that JBI has really gotten itself into a situation now. This kind of information is normally extremely sensitive. People sign Confidentiality Agreements for a reason when it comes to anything to do with Margin Analysis, Pro Formas, or these kinds of Front-End analyses. Something like this should never come into the public domain. I am sure that JBI's competition is very interested in this document!
But, why would JBI validate it by announcing that it is real? I would have been better to just ignore it. They have effectively said, "it is real, but you can't rely on it", with absolutely no backup behind it. Well, that is great. It is pretty powerful stuff, so what if this news caused a stock price rise? What if the plant does not meet these targets? Investors can say they have been misled.
It obviously had no serious effect on the stock price today.
Someone should contact IR and ask for the full report, or at least some backup for the numbers.
Furthermore, the 3-year ROI on that is like 50%. Not likely..
Yes. I always took it that the "processor" was the core technology around which an installation was based. You still have piping, variations due to differences in feedstock and required output, etc. There is always engineering around that core required. Therefore a low figure for the cost of a "processor" can be given without revealing the full capital cost of the entire installation.
I had guessed a capital cost of around $2 Million for 3 processors.
This report puts it in the same league as it's competition.
I have had a chance to have a good look at this document, and although it is well written and believable to a point, it falls down badly in one critical area, the EBITDA. Unless my math is wrong. Therefore I question it's authenticity. I find it surprising that JBI has issued a PR saying it was an improper release of a confidential document. This seems to imply it is the real thing.
The piece starts well. SAIC definitely does this kind of work. Here is a link on them:
http://www2.saic.com/announcement/saic-advances-2012-enr-rankings
They are not near the top of the list in terms of EPCM companies (Engineering Procurement Construction Management), but they are in the list. I would have preferred Bechtel or CH2M Hill, but they are there.
The stats around the 3-day operating period are good. At the throughput rate of 2000 lb/hour, that gives 144k lb of plastic processed max. Given the uptime they suggest, the 121k number given is reasonable.
An Order of Magnitude estimate is the first step(level 1 estimate) in an engineering analysis to design a system like this. It is accurate to +50/ -40% (I am guessing). Look in the AACE standards for the exact figures.
$6.5M + Engineering Design Fees + Contractor Distributable Cost for an additional $2M.
Seems reasonable. A bit high. If it is similar to other systems I have worked on, there is a core technology (the P2O processor) upon which the rest of the system is based. Therefore there will always be Engineering costs, but not much. I worked on a 10 Million job where the Engineering fees were about $500k. And this involved a proven core technology. So the numbers are not bad. Contractor Distributable Cost probably refers to materials paid for by the Construction Contractor that are reimbursable by the Owner, therefore additional to the costs covered in the Construction Contract part of the estimate. The basic model here is an EPC (Engineer Procure Construct) where a contractor takes on the whole responsibility to build the cluster, perhaps paying subcontractors for pieces of the work.
What is somewhat odd is that JBI has been at this for maybe 3 years now? You would think that they would have a more definitive estimate by now. Perhaps a Level 3 or 4 estimate. It would be accurate to maybe +- 20%. That is the first thing that is odd.
But, the EBITDA number is totally unbelievable. And, there is way too much detail encapsulated in that statement. Just some basic math:
From the document, they produced 10287 gallons of #6 and 4269 gallons of naptha in 3 days. Go to this link and find out how many barrels of oil that is:
http://www.metric-conversions.org/volume/us-dry-gallons-to-us-oil-barrels.htm?val=10287
You will find out that the most that is from both products is 460 barrels (326 barrels #6 and 135 barrels naptha).
The revenue generated is simply that number of barrels multiplied by the going rate. Using $70/ barrel, that gives $3.2 Million. TO arrive at that, assume 300 days of operation/year. That gives 46k barrels/year. Multiply by 70.
As for Cost, using $10/barrel, that gives is 460k (46k*10). Therefore the Most the EBITDA can be is $2,8 Million. Not including SG&A, etc.
I even thought of multiplying by 3 for a 3-processor cluster. Still far out. Double the rate to 4000 lb/ hour? Still only half of what the document says.
Therefore, I must question it's authenticity.
Can anyone dispute my math?
Rawnoc is correct. It is typical for a company to get third-party independent analysis done and those are exactly the words they use. I also think it is required for some companies by the SEC for large investments. Last year I worked in a large resources company and managed several third-party engineering efforts. it is required, and large enginering firms make a living off of doing this.
This document looks like it contains the most meat that I have seen so far on the commercial viability of JBI's p2o process. I don't know what it means yet, but it looks legitimate, and I will definitely have a closer look at it on the weekend. An "order-of magnitude" estimate is the highest-level estimate that can be done according to AACE standards.It is accurate to something like +40/-50 %.
hey. This is one of my favourite stocks. Nice dividend... excellent earnings. not sure why it is so low-priced. I think the only problem is reliance on Ford, but then again Ford is a winner.
what is with today's crash?
the following statement:
"but mostly is a concept easily understood by those who view it "
is a double-edged sword.
It means that JBI is a "sexy" stock. The business model or concept is appealing to almost anybody. I agree.
But... will it actually do what it promises to do?
in other words.. are you in it because you think the stock will rise because it has a great idea that has broad appeal and will sell lots of stock? .. or are you in it because you really believe P2O will work... profitably?
If you are in because of the former maybe you should think about it IMHO.
I have a list of criteria that I use to select stocks in a Stock Screener as a first step. My last test is if I believe in the business idea or concept. In other words, do I believe that this company will be a money-maker in this current macro environment? That has more to do with reading the paper every day than the numbers. It is too easy to get excited about something that is impractical or uneconomical, but is a great idea. You have to separate wishful thinking from business reality. Alternative energies are full of wishful thinking.
Good luck to you and I hope you have enough funds to make it work.
4kids: I must give you credit. This post (and the others that follow) actually makes good sense. Things are at the point where one believes in JBI or they don`t. I think recovery , cfp, and profitability is a pretty tall order. I think things just don`t change that quickly.. but it is really a matter of belief and you can`t argue with it. You may want to consider dropping the ~>>*, but your post makes good sense.
How do we know that the monofill sites (JBI?) are going to happen?
Isn't "revenues soared 67% y0y" a bit misleading? When you buy another company yes the revenues soar, but you get the accompanying costs and debt... I don't know the details, just pointing it out.
Also, P/E of 15 is high in this market. I am not sure of the definition of a Value stock,. but my only comment on what you are saying is that they don't generally pay dividends.
I had a quick look at this stock. Not bad, but I think it is overpriced. Nice earnings growth,liquidity, and a nice chart. It is the kind of solid company I like..
But..
Divident yield is poor at 1% and the P/E is way high at 20.
I think it is currently overpriced.
Mind you, if I had to compare the US with the Canadian markets right now, there are much better stocks av ailabel in Canada given basic Value criteria. My last go with a screening tool yielded about 30 stocks in Canada with all of the right criteria vs. 5 in the US.
And btw, this stock doe snot hae the criteria to make the list.
You are using figures from the Cash Flow Statement again, when the Income Statement is what matters. SG&A will not be impacted just because they paid down debt...unless they reduce their costs drastically, it will simply reoccur.
You are using figures from the Cash Flow Statement again, when the Income Stastement is what matters. SG&A will not be impacted just because they paid down debt...unless they reduce their costs drastically, it will simply reoccur.
It was not a mistake, just marketing... A lab saying something will scale up has nothing to do with whether or not it can perform well 24/7 with scheduled downtime for maintenance. That only comes through years of trial and error.
The Islechem was great to convince investors that it would be juch easier than it has been.
maybe. even if they had a Gross Margin of 50%, still alotta hamburger.
I took my numbers from the Income statement and used the Cash Flow Statement to look for further information. You will see that the numbers taken from the income Statement for the 6 months ended June 31 are accurate. The Cash Flow and Income Statements have to jive, but it is the Income Statement that matters. The Gross Margin is for that 6 month period as well.
Yes Gross Margin will get better, they just have to cook a whole lot of hamburger.
Regardless of the debt, if they operate the same way they wil burn another 6M (the rest of their cash) by the end of the year.
Well, for one thing, the CGS is about 75% of sales... that makes the Gross Margin 25%. Not great. In the first 6 months of this year, their SG&A was $6M. Total expenses of $7.3M.
Giving them the maximum accounting benefit, maybe you could add the Depreciation back on and the Impairment Loss, so maybe reduce the expenses by 500k. Therefore their true expenses on a cash basis were 6.8M.
The other item (from the Statement of Cash Flows) is the "Stock Based Compensation". Hmmm... well you really have to treat that as Cash, because if they did not compensate whoever it was in stock, they would have had to use cash wouldn't they? At least in order to continue operating the way they are. So that is cash. There are a few other items in there that may be simply accounting charges, but I think I have identified the major ones above.
They would have to achieve another 6.7M in Gross Margin to break even on a Cash Flow basis (roughly), which would require 4X that or $27M in sales. By the end of this year.
Is that remotely possible?