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Tipping Point.
The stock price went straight down from it's highs in late November to mid January then virtually flat from that point on. One of two things will happen 1. A major revenue generating event will occur which will propel the stock price to new highs permanently, or 2. No major revenue announcement, in which case the price will drift below a dime. Participation in panels, small grant awards, placement of one or two more units may nudge the stock price temporarily, but will have no long lasting impact. Q-2 is going to be the "show me" quarter. SGLB either performs or it does not. Personally, I believe the odds are about 50/50.
Licensing
If I were running SGLB I believe I would seriously look at licensing my various technologies to companies with complimentary products that were in a better position than SGLB to bring them to market. While they would receive only modest licensing fees per unit this would relieve them of all of the hassles of arranging manufacturing, securing a distributor, etc, etc. It would allow them to focus on what they are really good at and that is enhancing the products they already have to make them more competitive and drawing on more research from the Lab to develop new products. It would seem that with their consulting income stream and additional income from licensing they could focus on applied research which is where their real strengths are. I've not heard this possibility discussed by Mark, yet it seems like an ideal solution to getting things going in more of a hurry than the path they are currently pursuing.
Thoughts??
I don't follow the Board on a regular basis. If you perceive my posts as "negative" that's your perogative. My thoughts on how SGLB should be valued are based upon my own personal experiences. I don't consider them to be negative or positive…simply the way I see it.
Let me be sure I understand. If a poster offers a view that is contrary to yours and is supported by a reasoned set of facts they are a basher. Is that correct? I have been an owner / partner in both hardware and software startups in Silicon Valley and spent many years in Apple's International Group, as well as a few other high tech companies. I believe I have a pretty good idea of what it takes to bring a product to market and the idea that Printrite 3D is going to suddenly morph into a cash generating machine is simply not feasible for reasons that I have outlined here several times before. I am not short. I don't currently own the stock because I don't believe the risk / reward is in my favor at the current price. I bought several hundred thousand shares early last summer at .03 and sold at .18 when I believed the price was getting frothy. I've done considerable due diligence on the company and attended the Board meeting last fall. You can choose to agree with my point of view or not but to label everyone who disagrees with your optimistic predictions a basher is uncalled for.
"Commercialization of PrintRite3D is just around the corner"…….nothing could be further from the truth. Commercialization requires a fully staffed and committed distributor who is capable of selling, distributing, supporting a customer base, and providing end-user training. While one or more distributors (and end users) are currently evaluating Printrite 3D there are NO commitments at the present time. Once a distributor agrees to take on the product there will be months of preparation before a product is commercialized. What we have today is a tiny cadre of smart guys who have prototype products that seem to have a place in the marketplace. It's not too different then when Steve and Woz had a prototype Apple 1 that they had cobbled together in Steve's garage. It was three more years with a great deal of support from Silicon Valley Venture capitalists beforev a marketable product was delivered to the public. Those of you who believe commercialization is "just around the corner" are going to get badly burned if you invest with that belief in mind. SGLB is trading today for exactly what it is worth…….the potential over time (and I would maintain far more time than most on this board would like to believe) to be a game changer in additive manufacturing. It will take years and not weeks before SGLB can become self-sufficient enough to demand the kind of share price that many here expect to happen in a matter of a few more weeks. As others have pointed out if they are forced to continue the dillutive financing we have experienced twice in the last 12 months just to pay the bills there won't be much left for investors when they do finally commercialize.
Glass half empty or half full. There are clearly at least two ways to view SGLB's immediate future. Most on the Board expect an announcement very soon that will propel the stock price to new heights not seen before. Others see a steadily declining share price (40% in three months / 20% since January 1) and are not so sure. My personal view is that the evaluation process with both GE and a potential distributor wiil take longer then most here believe. Mark's best guess on this at the Board meeting was Q-2. The evaluation process is largely out of SGLB's control and both GE and any distributor is going to want to be absolutely certain of their decision before committing to any significant contractual arrangement. I believe that the stock price will continue to drift lower in the shorter term and not stabilize until we are in the single digits. I'm waiting until that point to buy back in. If I'm wrong i'll miss the ride up. If I'm right then it becomes a far more profitable trade longer term. I've been in at .03 and out at .18 so I can't really complain if I miss this time around. GLTA
I believe it is a significant milestone in validating the technology and clearly puts SGLB among the movers and shakers who will be the leaders in this field. However, it does little to address the mundane problems of actually getting a robust, supportable, product in the hands of end users on a wide scale.
This agreement is for Metronics to do the evaluation that I briefly described. Not a distribution agreement
Jackie:
You touch on a subject that has been studiously ignored on this Board amid all of the technical squabling over the superiority of SGLB's offerings.
Let's keep in mind that SGLB is made up of only a handful of senior scientists/researchers, likely less than a dozen of which have experitise in their 3D software product. There is no manufacturing, packaging, marketing, sales, distribution, training, or support capabilities in-house. SGLB is totally dependent upon one or more distributors to perform these essential functions in order to bring any of their products to market. This is a tall order for any distributor and one that will require a significant investment in manpower and up-front investment. In order to effectively market Print-Rite to aerospace companies the distributor will need sales personnel that come from that environment and understand how Print Rite will enhance their production process. The same principle applies to the automobile industry, and other major manufacturing segments. The distributor needs also to be able to provide training, support and end user documentation in support of the products. Finally, if Print-Rite is to be sold in regions/countries where the distributor does not have a presence dealers will be required who must possess many of the same capabilites as the distributor. If the products are to be sold outside the U.S. then localization of all print and support material into Chinese, Japanese, German, French, Spanish, etc. will be required. The benefit of the distribution network is that it relieves SGLB of functions they are incapable of performing, the downside is that the vast majority of profits generated will flow to the distribution/dealer network and not to SGLB. At the moment without a firm commitment from at least one major distributor SGLB is totally incapable of supporting any sort of significant order, other than the small evaluation projects that are currently on-going.
Potential distributors are going to be very careful in commiting to a distribution agreement until they have ascertained the market demand for SGLB's products, the investment required to support sales and distribution, and their projected returns. This is not something that a major distributor is going to rush into without a full and careful evaluation process. I would expect such an evaluation to take several months to complete and then once agreements are reached several additional months to implement.
My point in all of this is it is a major leap from where we are today to actually generating any sort of significant revenue stream for SGLB. If you have doubts about what I have described above then all I can say is just wait to see how it all unfolds. It will become much clearer at that point.
JJ: I don't have any argument with either the quality and potential of the products or the quality of the personnel. I think they are both top notch. They are currently at the mercy of their potential distributors and end-user evaluators who have yet to commit to firm orders. No one knows how long this is going to take to materialize (or even if it is going to materialize). We can all make our best guess about when/if they will get that first substantial order. Until then they don't generate sufficient revenue from their consulting arm to maintain the business. The longer this goes on the lower the price will be . I attended the Board meeting last fall and came away with Mark's best guess that orders could not be expected until mid year. If that turns out to be accurate the stock will not hold current price points until then. Just my opinion.
Lots and lots of assumptions….to say nothing of a leap of faith. I haven't shorted, but I'm not buying either. Here's my assumption…..I'll be able to buy all I want between .08 and .10 by March 15 if they don't book a significant order or two before then.
Are you smoking something you would like to share. Chart reversal??? Look at the three month chart..Look at the one month chart…Look at today's chart. They are all headed in the same direction. Down. I haven't seen any indication that this is going to change in the near future.
Silversmith: No one will argue with you about the "potential" although I think you are getting a little over-enthusiastic in that regard as well. Keep in mind that these products are in evaluation by folks in the real world who will profit or lose by selling/using them. I'd like to believe they will be wildly successful but that is far from a given at this point. If the evaluations drag out longer than expected, if further dilution is required to stay in business without firm contracts what do you think the stock price is going to do? All of this is very possible. To get to the "potential" you dream about they have to successfully survive the next six to nine months. You are placing your bet on far flimsier evidence of future success than I feel comfortable with. That's the difference in our investent outlook. Best of luck to you. If the stock gets back to the .08-.10 level I'll be joining you because at that point I believe the reward balances the risk. If contracts are announced I'll also be back in as well. Until that time I'll watch from the sidelines.
Schris: I don't really believe anything has changed. I just believe that the market is taking a little more realistic look at SGLB's immediate prospects. Unfortunately, since the Board meeting there has been further dilution and no contract awards. I sold all my shares at .18 and have been on the sidelines since that time, but watching closely. Mark stated at the meeting that both the printing and dental products were in an evaluation status by both potential distributors and end users. He cautioned that the evaluations would take some time before orders could be expected. The sense I came away with was that the earliest that this could happen was this spring /early summer. While Mark and the Board are extremely impressive academics/researchers there was no one in the entire company with a marketing/sales/distribution background. There also were no independent directors, which bothered me some. I asked when they planned to bring on an independent director with a solid business background and I was assured that it was already in process. Sure enough an appointment was announced within weeks of the Board meeting. I really like these guys and want to see them succeed but you have to understand that they are extremely thinly staffed and are totally dependent upon potential distibutors to carry the full weight of sales, distribution, marketing, etc. I believe the stock will be range-bound at best until solid revenue generating contracts are announced. Of course, I could be totally wrong, but that is how I'm basing my investment decisions.
Long-vestor I don't see SGLB's future too much differently than you do. Virtually everyone who has purchased shares in the past three months is currently underwater and the stock price trend is unquestionably negative. The only thing that will move the stock price permanently into new higher territory is an announcement of one or more contracts that provide a sustainable revenue stream. Of coure this could happen at any time…..or not. If SGLB were forced to dilute shareholders further without the immediate promise of sustainable revenue to support the ongoing reserach this will be a .03-.05 stock again in short order. I believe that management has only four or five months of funds on hand to ink a deal that will at least pay the R&D bills until more lucrative contracts are signed. In the interim we have an overall negative market outlook to contend with, the bloom faded from 3D printing stocks in general, and only the most speculative investors staying the course hoping for news that will turn the price around. As time goes on, absent contractual commitments, more and more of these folks will cut their losses and abandon ship.
I attended the last board meeting of SGLB and was very impressed with both management and the Board. They have an uphill battle however to commercialize their research and while I wish them every success the outcome is far from certain and until it does become certain we are going to see a continuing erosion in the stock price.
Silversmith, thanks for your contribution. Finally some rational discussion on the Board rather than all the Rah Rah this stock is going to the moon. I find little to disagree with in your comments except the one about the stock not trading on fundamentals but on potential. That has been the theme these past several months and it resulted in a significant down-turn when the fundamentals did not develop. I believe that until real revenue streams develop (and I think your two year forecast is probably acurate) the stock is going to be range-bound simply because of the uncertainties associated with eventual success or failure. Investors are willing to put up a dime or a quarter a share betting o the future, but they are not going to put up serious money until the company proves itself. Just my 2 cents.
I Wouldn't Celebrate Quite Yet
Nothing has really changed. There are no new announcements. There is no news. The stock has been in a strong down-trend for the past six weeks and positive corrections are to be expected. I'd wait until we get through next week (at a minimum) and if the price holds at that point then perhaps we will stay in a holding pattern until we get substantive news of contract awards and new revenue streams. There are obviously a good sized group of traders that are going to do everything possible to push the share price down beginning Tuesday morning. I'd curb my enthusiasm until you see how that turns out.
Not to be a Wet Blanket
I continue to believe that the stock will settle (after perhaps the next month or two) in the .08-.10 range awaiting news of significant revenue contracts. While SGLB has a number of promising irons in the fire investors have been burned once already by unrealistic expectations for SGLB to transition from a tiny R & D startup to a full fledged commercial concern. The infrastructure is clearly not in place for this to happen now, even if significant contractural awards were made in the near future. At a price below .10 it is worth betting on the future, which even then is clearly a crapshoot. While this opinion will not sit well with the bulls on the Board I have to believe that the majority who have already sold have a good deal of empathy with this view.
Take your pick of timeframe. From about August 22 through September 23 the stock was basically steady at .08 In the next three weeks it reached a high of .21 and has closed since that time on a daily basis at .19, .17, .15, .14, .13, .14, .13, .14. .14 is a 33.33% drop from the high in less than two weeks. So, yes, I would consider that a trend.
Silversmith:
Totally disagree. The stock is clearly trending downward and only got a blip when the recent small contract was announced. I agree with you on one point however the price is entirely news dependent. No news and the downward trend continues uninterupted. This is a company with insufficient revenue to sustain on-going operations and is entirely contract dependent (which have yet to materialize in any significant way). If we get into tax selling season without contractual agreements you are going to see those that were enticed to buy in the high teens selling in droves with the hopes of picking up shares at a lower price after the first of the year. The relentless rosy projections for the short term price of the stock are simply not based on real-world facts.
All contracts of any size are positive news. No question. Keep in mind however that $178,000 is about one month's expenses for SGLB. Certainly nice to have, but not a game changer. Those that are predicting the stock price going to the moon based upon a $178,000 award are going to be disappointed when then euphoria wears thin.
QFab:
You are absolutely correct it wasn't two weeks it was a 40% drop in a week and a half. The high on October 15 was .19 and on October 16 .21. Thanks for the clarification.
A well thought-out post and all good questions. I think that there are few here who don't anticipate a stock price several times it's current level 18 months from now. The disagreement is over what happens between how the stock price reacts between then and now. Your questions and concerns are on target. Contract announcements, new customers, new applications for PrintRite3D, and other significant news will have the potential to double the stock price in a week. The lack of contracts, another dillutive stock offering, or the flooding of the market with the earlier penny offering has the potential to move the price back below a nickle again. From my perspective I don't anticipate any significant progress on the contractual front until sometime in late Q-1. If I'm correct SGLB will be at significant risk of having to do another dilutive stock offering. They have made plain that they don't want to do this but they simply may have no choice just to keep the lights on.
To me, the odds favor a quiet period between now and somtime in Q-1. If I'm correct the stock price will almost certainly settle back below .10 and consolidate. If we are unfortunate enough to have an overall market correction (which seems overdue) the stock price could sink lower.
Those of you that are buying on dips need to take a hard look at your strategy. Buying on dips works well when the stock price is in a clear uptrend. It doesn't work so well when the stock price has declined almost 40% in the past two weeks. Until we see a couple weeks of relatively stable prices the risk is significant.
Texas:
I'm extremely optimistic longer term, however with no significant news I expect the price to base sub .10 until there are one or more contracts announced. We recently moved to Albuquerque from Placitas NM (midway between Albuquerque and Santa Fe). We have always liked New Mexico..great four season climate, lots of historical interest, moderate cost of living, and don't forget the green chile!!
I think you will be pretty happy with that trade in a few days. There are an awful lot of sellers today and not so many buyers.
More importantly what's the clear direction and momentum?
Let's get real for a moment about expectations.Your loyalty is not owed to anyone but yourself to make a profit on your investment. When you start becoming loyal to stocks you better have very deep pockets. And, what exactly are the expected near term achievements that you refer to? I'm personally not aware of any, and therein lies the problem with the current price.
Exactly one month ago today SGLB closed at .07 (where the price had been consolidating for over a month) . A week ago it closed at .19. That's a 158% increase in the stock price in three weeks. The price increase was fueled by a couple of catalysts: the grant award, participation in the technical panel, and perhaps the Board meeting. While there could be another positive announcement tomorrow, none is anticipated that I am aware of. SGLB is subsisting on a minimum income stream from their consulting business and currently has no inked contracts with anyone that will generate the necessary income to pay the bills. We all believe that their memorandums of understanding will morph into signed revenue generating contracts at some point but when and for what amount is very much up in the air.
I'm a firm believer in both SGLB's technology and in their personnel. They are both top notch. However until they have revenue generating contracts in hand for PrintRite3D it is unrealistic to expect the stock price to do much more than stagnate. My personal prediction, as I have said before, is that we will see .08/.09 prices long before we see.19 again. I believe this level is fair value while we wait for signed customer commitments. Most of you won't agree with the way I see things and that's fine. That's what makes a market. This is a discussion board and all points of view should be considered in an open dialogue. Our collective goal should be to make a profit. We'll all get there by different routes, but if you only seriously consider one side of an argument you are doing yourself a serious disservice.
Out at .178. See post #6650.
3DPrint:
You asked privately why I thought SGLB would return to the .08/.09 level next week. I attempted to make this a private reply but am not an InvestorsHub member and could not.(since I visit here rarely) I hope you don't object to me stating my reasons publicly. First I would say that I am very impressed with both the technology and the personnel that I met at the SGLB Board meeting. These are very smart folks and I believe longer term they are going to be extremely successful.That being said here is the rationale for my comment:
1. I don't believe that SGLB is going to see sustainable appreciation until they ink one or more substantive contracts. I also believe that contracts in the dental or munitions area won't cut it. The contract (preferably more than one) is going to have to be for PrintRite3D (that is clearly their ace in the hole). What I gleaned from the Board meeting was that such a contract is at least six months away, if not more. They are still in the "memorandum of understanding stage" and it was made clear to me that this very much involves "proof of concept" prior to signed contracts. They believe that they have made an excellent start with GE but they are some time away from a contractual relationship.
2. My opinion (obviously not shared on this Board) is that both the selection for participation in the NIST grant and the participation in a panel discussion at the recent Additive Mfg. conference were greatly over-hyped in significance. Being one of twenty participants (with an unknown allocation of resources) in a five million dollar grant did not convey nearly the significance to me as it did to most others here. Also being a panel member at a single session of a multi-day conference in your area of expertise while nice did not deserve the attention it received in my opinon as well.
3. Because of the overall rush to all things 3D, SGLB's history with the Lab, the obvious quality of their personnel,. the penny status of their stock, the appeal of the PrintRite3D technology, and the recent (I believe somewhat unfounded) enthusiam generated by the grant and the conference a lot of traders have bought in looking to make a quick buck. I don't believe the stock appreciated from .08 to .21 in a couple weeks on the backs of long-term investors alone. With the speed of the run-up and no new news to sustain the price in my opinion a pull back was a given.
4. My prediction of the price reaching the .08/.09 level by next week may well be premature. However, unless something unexpected happens on the contractual front I would expect to see the price gradually drift down below .10 and trade in a range until there is solid evidence of a new sustainable revenue stream. When it does bottom and level out I'll be a buyer once again.
All of this is simply my personal opinion. I am often wrong and may be in this instance as well. You asked, and those are my reasons.
Waiting for .08/.09 to add. Will likely see that next week.
Out at .178
This was almost a six bagger for both my account and my grandchildren's. It just got too frothy for my taste. Based upon what I heard at the Board meeting I don't really expect to see much in the way of contracts until about Q-2 14. I believe that after the conference hoopla settles down and the overall market starts it's overdue retreat this may very well be back in the single digits. I'm local to SGLB and will continue to watch closely. If I'm wrong, I certainly can't complain about a six bagger in less than six months. If I'm correct, I'll certainly be buying in again. Good luck to everyone still here I hope your dreams all come true.
Commercialization is very much dependent upon how quickly the memorandums of understanding morph into firm contracts. It's a bit of a three way dance between SGLB, potential distributors and current test sites. The distributors need to know that they will have a product to distribute that is both robust and in demand by end users before they are willing to invest in the costs associated with distribution. SGLB is working hard to achieve that level of confidence in both their test sites and with potential distributors. It's anybody's guess how long the process will take.
SGLB Board Meeting Report
I had the pleasure of attending the SCLB Board meeting in Santa Fe this morning. The meeting was held in the Board Room of the Santa Fe Business Incubator facility which houses SGLB along with another half dozen early start-ups. In addition to all Board members and Mark Cola, the CFO (contracted position),and Investor Relations person, were present. The Board attorney and SGLB’s Chief Scientist were available by speaker phone. There were three or four attendees associated with the company is some manner and only three independent stockholders in attendance. The comment was made during the meeting that attendance this year was better than last. Santa Fe is notoriously difficult to fly into so I would expect board meeting attendance to continue to be sparse.
Mark called the meeting to order and the Board went through the perfunctory process of approving the election of the current board members, the auditors and the equity incentive plan. After a very brief overview presentation by Mark on the history of the company and the various research areas they were pursuing he opened the floor for questions. I expressed my strong belief that the Board needed to add at least one independent director who had a strong business marketing, negotiations, distribution background. I was very pleased to hear that the Board saw this need as well and was currently in active discussions with more than one strong candidates.
A question was asked about the numerous “memorandums of understanding” that SGLB was involved in and why these were not contracts instead. Mark stated that SGLB was primarily an R&D facility created to commercialize some of the more promising technologies that originated in the Lab. He made it clear that they currently had neither the expertise nor experienced personnel to bring these technologies to market. He stated that they would be exclusively dependent upon third-party distributors who already had a presence and expertise in markets where they believed their products could make a meaningful contribution. The memorandums of understanding are an interim step prior to formal contractual agreements being signed with the distributors. For example Burke E Porter Machinery the proposed distributor for PrintRite3D has sat in on many of SGLB’s interactions with GE. Porter wants to be sure of a broad customer need and acceptance before taking on the distributorship. Mark told me after the meeting that he felt that while they have had significant success with GE (with some additional exciting announcements to be released in three to four months he said) they were still in a “proving mode”. So, in summary, the MoU’s are temporary “get acquainted, proof of concept” prior to formal contracts.
This discussion prompted me to ask Mark if he believed the current revenue run-rate was sufficient to maintain operations without another dilutive stock offering until revenues from commercialization could be realized. His answer was that they were OK in the short to medium time frame (undefined) but that they could not sustain normal operations longer term without commercialization.
In my brief discussion with Mark following the meeting I asked how he felt about the acceptance of their technology by GE. He was very positive about the acceptance and told me that GE was looking into several new application areas. I asked him point blank if he thought that SGLB was a takeover target by GE once they had proven out the technology. He paused to consider his answer and then said with a chuckle that the subject had come up in casual conversation but that he believed that GE didn’t have enough experience with their technology as yet to know how to value them.
Overall I came away very impressed with the caliber of the individuals involved. They knew both their strengths and weaknesses and were taking steps to exploit both. The Board is very positive about the future of the company and believes that they are just getting started on what will be a grand and profitable adventure. Perhaps because I was the only one asking questions at the meeting Michael Thacker invited me to call him to have lunch together in Santa Fe so that he could share some of his enthusiasm about what he believes the future holds. Mark was decidedly unhappy with the invitation and immediately cautioned Thacker that he could not discuss anything that had not been publicly released. I plan to take Thacker up on his invitation.
In summary, I liked what I heard today. I have confidence in the sizable investment that I have already made and will be adding on weakness. The major risk that I foresee is the possibility of further dilution if existing and planned products cannot be commercialized and distributed in a timely manner.
Not sure about Huntsville but Los Alamos NM has the highest concentration of millionairesin the U.S. in it's total population of some 17,000 people. They are also in the top five for concentration of Ph D's for their population. The SLGB staff come from a very well educated and well-heeled background.
Annual Meeting
I plan on attending the annual meeting on October 10....I live nearby in Albuquerque. I'll be happy to pass along any information I receive on the potential for additional income streams or joint ventures. I do plan to voice my concern over the lack of independent directors on the Board. This is really a short-coming and causes legitimate concern among stockholders over the motivations of management.
For a far more informed discussion of the pros and cons of FEEC from long term investors without all the worthless "Rah Rah" I recommend the Investor Village FEEC board.
You can have the shares issued in your name for free by Ameritrade and handle the dissent yourself. Ameritrade is required by law to provide you with the necessary forms, etc. It remains unclear whether an attorney will be required or not to represent shareholder interests. There are some interesting comments on the Yahoo Board.
CHGY. PLease join other shareholders in fighting the low-ball buyout offer by CHGY. See the CHGY Investor Village Board or Yahoo Board to pledge your shares. Thank you.