I can't reply to private messages. I only have the basic membership Sorry.
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Earnings report CC transcript now available on SA
Here's the link
Keith Markey of Griffin Securities on XON, ZIOP & FCSC
"I like both Fibrocell and Intrexon, which has a business-to-business (B2B) model. The collaboration has created a cell therapy for both children and older people with RDEB, a blistering condition that starts at the time of birth and ultimately takes a person's life prematurely, usually when in his or her 20s. The gene therapy involves inserting the correct gene for collagen VII, which is the material that knits the epidermis (outer layer of the skin) to the dermis (the inner layer of the skin). The hope is that by inserting this gene into the fibroblasts that are part of the dermal layer, there will be an expression of sufficient collagen VII to hold the outer layer in place and prevent the blistering. Even for short periods of time, that would be very helpful to the patient."
full article:
Five Stocks Griffin Securities' Keith Markey Thinks Could Double or Triple
I'm confused. You used "yahoo board" and "good" in the same sentence. Didn't think that was possible :D
Awesome, thanks!
Does anyone actually have a number for the pounds of corn oil produced per gallon of ethanol or bushels of corn produced? I'm not looking for a number specific to PEIX.
I am aware that PEIX has provided an average percentage value, but I'm looking for a more specific number.
Well the thing is anyone can write an article for SA. How it gets distributed is another matter. If the author is articulate and presents coherent rhetoric, be it fact or fiction, they can manage to get included for "premium" distribution. The bar here seems to be whether the editor feels it's content that paid subscribers will believe gives them some sort of advantage (why else would anyone pay to subscribe?). Those articles are released to paid subscribers 3 days prior to release to the general public. That's become a favorite avenue for manipulators, because the subscribers believe they're getting an inside scoop. Unfortunately, as it more often tends to be shorts as opposed to longs who gravitate towards writing highly manipulated fact & fiction, those articles are often associated with planned short attacks on the day the article is finally released to the general public.
If they fall short of the premium bar but it still has some merit, it can be included for general distribution as an article. Then there's the one that don't even meet the editorial standards for SA. Those are relegated to blogs.
I don't want to imply the author of that piece in particular is short PEIX. The bottom line reasoning seemed to be more about driving a migration of cash over to earnings speculation on REX & GPRE.
It's a little difficult to judge his statement that PEIX "faces bigger hurdles to strong earnings in 2015 than do its independent competitors" as he doesn't factor in the overall impact of the sybergies that are going to work in PEIX's favour as a result of the merger, nor does he really take into account the West Coast factor in any meaningful way in any of his discussion. As for the Iowa numbers, well, all I can say is that's Iowa, not the West Coast. Conflating the two can lead to very erroneous conclusions.
He crux of his article seems to be the fact that January and February were difficult months when it comes to ethanol margins. No surprise there. Anyone who isn't aware of that should probably not be in ethanol producers. However his premise that reduction of PEIX's long term liabilities in relation to current liabilities ratio is a bit of a crock. The ratio dropped because PEIX all but eliminated their long term debt, not because their current liabilities increased. In fact, if you take a look at the table he provided, their current liabilities by quarter have DECREASED by 9.8% over the prior Q4 while their cash has INCREASED by a whopping 1240%, not to mention that as a percentage of total assets the cash portion increased by 1050%.
Perhaps he might want to take that into account when discussing the ability of PEIX to improve their profit ratio going forward. I mean seriously, in the past year PEIX transformed from a company that was driven to it's knees by an almost all-consuming debt burden to a company capable of taking advantage of a severe downturn in the industry to become the 5th largest ethanol producer in the US.
As for his attempt to shake the tree regarding the LCFS, he completely ignored the impact of the co-generation plant upgrade, among other improvements currently being implemented.
Strangely enough, he also completely ignores the impact of Kinergy. How can you discuss PEIX revenue generating ability without including Kinergy?
After first cautioning against using current energy prices to predict future earnings, he repeatedly relies on exactly that crystal ball gazing strategy to paint a dreary picture for PEIX. He's clearly a holder of Mid-West ethanol producers. I'm sure he knows lots about Mid-West margins as they relate to Iowa. However, his complete lack of discussion about the factors that influence West Coast margins have me tending to dismiss his discussion.
I'm sure he wants a mad rush to occur with investors driving up the share prices of REX & GPRE (his recent articles discussing them continues to be extremely bullish). That may well happen, but there's certainly no need to attempt to accomplish that by misrepresenting PEIX.
He wrote two articles this quarter about PEIX. Prior to that his most recent was written in October of 2013. Strangely enough, the title was eerily similar to this one: "A New Headwind For Pacific Ethanol." Following that article, he went strangely quiet on covering PEIX until now. Meanwhile PEIX underwent a major transformation. Just sayin' . . .
Actually the well informed comments in the responses to your article says it all. You can't even discuss the basics. All you offer as a short pump is empty rhetoric. I know you want to stampede the retail, but there's a lot of highly informed holders in this stock.
Good nite and good bye Joe Retail oops I mean getacet oops I mean krill66 oops I mean ledrog. Your posts, no matter which handle you use and board you post on, are devoid of any substantive content. I have no intention of wasting any more time on them.
My my the author is pumping his own blog here now. More handles than Heinz 57.
IB shows a current inventory of 500,000 shares available to borrow for ZIOP (that was the balance available as of the time I checked today). FYI it's my understanding that IB reports the entire locatable inventory, not simply their own inventory).
Shortable Stocks for United States
Are your shares be lent out without your knowledge? If you hold shares in a margin account and are running a negative balance on the account (the account is in margin), the answer may well be yes. Note that it's the overall account that governs the broker's right to lend your shares (see your account agreement), not simply whether your ZIOP shares are held on margin.
There are a number of myths out there about lending. That includes the prevalent myth that if you put the shares up for sale, they can't be lent out. Not true. So if you think your shares aren't lent out because you put them up for sale @ $40 (or whatever), you're wrong.
Here's one good article that discusses some of the aspects of share lending as it relates to margin accounts.
... did you know that the shares you have purchased may be lent out to other parties without your knowledge or granted permission?
Not sure at this point. First bought into ZIOP @ 4.80 and kept adding on the way up. Not sure, it might base/consolidate around where it is now for a while. Just got into FCSC. Also holding SYN. All three are tied together through the major shareholder in each (RJ Kirk). Kicking myself for not getting into CRMD. My other big payoff is III on the Toronto exchange. It's a mining stock that had a major blow-out of their tailings pond. Kind of like what happened to BP, the panic selling cratered it to way below value. Plus they're bringing a new mine online. Up 50% on that one.
I think the Q1 numbers for PEIX might create one more buying opportunity. Hope I'm right, cause I think long term after the merger the synergy is going to make them a powerhouse. Might even just pick up some deep in money longer term calls before then, like I did last winter :)
Still watching from the sidelines. I would of loaded back up, but I'm already all in on ZIOP. Talk about zoom zoom . . .
I think there's something else going on too. The price of milo in Kansas City is kind of interesting. KC is 4 hours from the Aurora plants. Considering it's also that close to corn, I see no reason why PEIX can't bring it in to California. Add California to the Nebraska plants and they've got some buying power :D
KC daily rpices
The price of milo is by the cwt, so divide by 1.786 to get the bushel price.
7.2100/1.786 = $4.03
Given the advanced credits they would earn, I really got to wonder if this is part of the plan.
If anyone gets through on the call tomorrow, this would be good to ask about.
Massive beat.
Me too, doubled up (although my position isn't that large)
For those who didn't see it, here's the link to a fully replay on u tube
Vice Special Report: Killing Cancer
Thanks for this post as well as the information you laid out in your previous Seel. As someone relatively new to this area of investing, I appreciate the sources you laid out for conducting DD.
I have a research background myself, which I've applied in other areas of investing. Your statement about "cherry picking" is only too true - if one does not learn to conduct their own investigation and relies purely on what other posters tell them, one leaves oneself open to be misled. Following majority opinion without investigating whether that opinion is substantiated by the underlying facts, I've learned, is a quick way to lose money.
Honestly I don't think anyone can call it right now. There are just so many variables in play on top of the investigation. Of course, a positive outcome of the investigation, released sooner than later, could have a very positive impact. It could bring enough of a move up to allow a capital raise, which pretty much everyone admits has to happen, just to see the way past the first well. A negative outcome could be a death knell.
Then there's the price of crude. You only have to look to the likes of AOI to see the impact that's had on a company with a string of successful wells. Of course, they are also closely linked to Tullow. Together they've significantly curtailed their drilling plans for the foreseeable future. For that matter, the precipitous drop of TPN in the midst of drilling their first well in Kenya goes to show just how much the landscape has changed. Keep in mind too that both of those are land-based operations, with considerably cheaper exploration and development costs.
The tide could shift for HDY. Should the investigation wrap up soon, followed by a strong surge in oil prices would again bring about a dramatic shift in the playing field.
I've been on the sidelines for a while now with HDY. If I detect enough change I'll move back in. For me, that's going to have to include more than just an opaque reference in the latest Tullow news. When you factor in their clear indications regarding developing the Ghana and Kenya operations, I don't see how it leaves anything for Guinea in 2015. Regardless, I don't see Tullow or Dana spending anything until they know the impact of any investigation on their portions of the leasehold. They just aren't going to throw money into a well when the possibility exists that it could all be yanked.
Getting above a buck only solves the most recent delisting issue. The longer outstanding one still looms.
In addition, the NYSE noted Hyperdynamics remains subject to NYSE continued listing standards with respect to the plan of Hyperdynamics to regain compliance with the $50 Million Standard. The $50 Million Standard requires the Company to maintain an average market capitalization and stockholders' equity greater than $50 million over a 30 trading-day period. In April 2014 Hyperdynamics received notice from the NYSE of falling below the $50 Million Standard. Hyperdynamics submitted a plan and provided periodic updates to the NYSE to regain compliance within 18 months. The Company's plan was accepted by the NYSE subject to continued monitoring.
* Shareholders equity as of Dec 31 2014 was reported as $37.745M
* Market Cap as of Feb 13th was $18.86M
A share price of $2.38 would solve half that problem.
How ironic
(with credit to hispeedsoul on the MARA board for first posting this article)
Qualcomm’s Antitrust Deal in China has Started Patent Battles in the Far East
A couple of snippets:
Speaking to Reuters about this Wang Yanhui, secretary general of the Mobile China Alliance he said that “For the first time, the settlement is forcing domestic manufacturers to recognize the value of IP (intellectual property) and consider how to use it strategically, which companies do in the West”.
and . . .
In a statement, ZTE said that the deal “is positive for the development and protection of intellectual property rights in China, and will help promote fair competition for technology innovators.”
Nice. Thanks for this CHM.
Typical sell the news follow-up. By now the ADD-driven attention span of the momo crowd is being drawn by another colored bauble that they'll flock to after it's already gained 20%. The price erodes as they sell their trades. They have no understanding of this stock, nor do they want to. It's all part of why nothing goes up in a straight line. The shorts will also play off their exit, warning everyone to sell.
I've done my due diligence, and am quite comfortable with VRNG. Of course that also comes with a low re-entry point and enough time to be far enough from it to have some tolerance for the typical post-news downward drift.
Thanks for posting this, Postyle. Prior order disolved and case moved. Couldn't ask for a better outcome
Hey danke, I'm spending some time going over the Aventine financials contained in the S-4 this afternoon. It would appear that they got caught hedging corn in 2013. From pg 55:
Corn. For the nine month period ending September 30, 2014, Midwest spot corn prices averaged approximately $4.30 per bushel compared to an average price of $6.29 per bushel during the first nine months of 2013, a decrease of approximately 32%.
Aventine continuously purchases corn for physical delivery from suppliers using forward purchase contracts in order to assure supply. As Aventine does this, it may sell a like amount of Chicago Board of Trade (“CBOT”) corn futures with similar dates to lock in the basis differential. On occasion, Aventine uses CBOT futures contracts to lock in the price of corn by taking long purchase positions in CBOT contracts in order to reduce Aventine’s risk of price increases. Exchange traded forward contracts for commodities are marked to market each period. Aventine’s forward physical purchases of corn are not marked to market. At September 30, 2014, Aventine had fixed-price contracts for the delivery of 3.7 million bushels of corn through January 31, 2015.
So it appears that had they bought at market during those 9 months, they would of paid somewhere around $6.29 a bushel instead of the $7.14 they ended up paying.
There's some excellent information in this document. For example, the co-product return for Aventine was 47.1% for the 1st 9 months of 2014 (compared to 37% for 2013). That's considerably higher that the typical return PEIX sees. I assume the lower 2013 number was in larger part due to the higher price of corn.
They also give an excellent breakdown of costs. These numbers will be very helpful going forward in attempting to estimate their quarterly revenue going forward. The following is from pp 57-58:
Now if we can determine where that ethanol is typically shipped to, it might give us the shipping cost to CA from Nebraska. In addition, the utilities, salary, maintenance, denaturant and general overhead costs can be applied against operating revenues in order to come up with an estimate of net operating revenues going forward. Of course, a breakdown of PEIX numbers like this would be extremely helpful.
Another thing to keep in mind is the effect of their use of sugar as a feedstock throughout 2014. Then there's the impact of financing costs . . . mind you PEIX states that re-financing that debt will be one of the 1st priorities, so interest costs may go down.
Ok I'm just guessing here because I haven't really followed AVRW. There could be several reasons. Keepin mind AVRW is also buying for plants in Illinois.
1. The frequency of buys could affect the quarterly average price. Buying less often could result in having to buy at a more or less opportune time.
2. Hedging could affect the cost.
3. I believe PEIX gets better than market prices for their California plants because they lease out storage space at the Madera plant to a grain distributer. That gives them access to market priced grain right when they need it.
PEIX may also be able to access better prices due to increased volume. They may have established better arrangements from a regular supplier in Nebraska. This is also one of the potential upsides I see coming from the merger. They already purchase corn in Nebraska, and that volume is about to increase significantly. That may result in reduced costs overall when that purchasing power is combined.
I wonder how realistic it is for the Neeley model to use rack prices? I don't track the South Dakota rack & USDA reported plant numbers. I used to track Iowa, but as I learned more about PEIX ethanol purchase, I started tracking Nebraska instead. I'm also now tracking Illinois numbers, as they became relevant to PEIX with the impending merger. Here's a comparison (the numbers are weekly averages as of last friday, rounded to the nearest penny)
Neb. Rack: $1.54
Neb. Plant $1.30
(difference of $0.24)
Illinois Rack: $1.65
Illinois Plant $1.39
(difference of $0.26)
If a similar spread exists between rack and plant numbers for South Dakota, and it's more common for plants to receive the average rate plants are selling for, then the Neeley profitability number would be inflated. Might be a good question for DTN.
While the Neeley model does include DDGS, it looks like it doesn't include corn oil production. That would add 1-2 cents . . .
The weekly update for the plant numbers from Nebraska & Illinois should be out in a couple hours . . . on the bright side, while the PEIX margin still isn't great, it looks like Kinergy should be profitable again this week . . .
"the symbol has changed, for example from CTH.V to CTH.T, IF it had changed from the Vancouver to Toronto exchanges"
That would be it.
CTH.TO
https://ca.finance.yahoo.com/q/h?s=CTH.TO
CTH.V
https://ca.finance.yahoo.com/q?s=CTH.V
Note the date on the CTH.V listing. It was last listed on the TSXV on Nov 27th. Here's the news release of the switch over to the TSX from the TSXV
http://finance.yahoo.com/news/cynapsus-therapeutics-announces-uplisting-toronto-211000431.html
I think the first set is combined PEIX + Aventine, prepared for Craig Hollum.
At first it's not very clear, but if you read the explanation as well as the footnote to the 1st table, it talks about PEIX and Aventine preparing this for Craig-Hallum. Here's a snippet from the footnote to the first table:
Adjusted EBITDA was used by management to provide additional information in order to provide them with an alternative method for assessing Pacific Ethanol’s and Aventine’s financial condition and operating results.
It was just a really lousy piece of writing.
The next three sets are PEIX stand-alone, Aventine stand-alone, and combined, as prepared for the PEIX board. There is still a discrepancy between the two combined sets, which is explained in the text as well as the follow-up footnotes.
Thanks for this CHM, helps keep things in perspective.
West Coast ethanol inventory
2.435M, up from 2.317M barrels
By comparison, one year ago on Jan 25 2013, the number was 2.798M barrels.
Yes, you'd think they were OPEC, the way they're pressing on full speed ahead. Mind you there's another side to this coin. Given the increased consumption, come the driving season they'll never keep up to demand. This could be the beginning of a very pronounced need to produce flat out in order to fulfill the yearly demand. It might be time for the supply/demand analysts to take a step back and see the larger picture.
"commencing December 31, 2014 of at least $15,000,000"
I find the choice of date interesting. Why Dec 31st 2014 (which captures the ending date of the prior quarter) instead of Jan 1st 2015 (when the next quarter commences? Was that a tip-off as well?
Anyone know what happened to the Progressive Fuels Ltd website? It's been unavailable since sometime yesterday evening.
Makes it hard to keep tracking the numbers :(
As promised
The PEIX numbers to date
That link should open a full-size image of the complete set of numbers I've been tracking for the quarter to date. You should be able to download the image.
Worst case scenario, they announce their intent to undergo a reverse split in early June and call a stockholders meeting to hold an approval vote. That buys them a couple more months.
Take a look at PEIX. Their share price was below a buck from July 2012 until May 2013 when, when they finally enacted a 15:1 reverse split to remedy their non-compliance. The NASDAQ is in no hurry to delist any company.
In the case of Vringo they received a notice of non-compliance in December.
Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer or Listing.
On December 18, 2014, Vringo, Inc. (the "Company") received a notification letter from The NASDAQ Stock Market ("NASDAQ") informing the Company that for the last 30 consecutive business days, the bid price of the Company’s securities had closed below $1.00 per share, which is the minimum required closing bid price for continued listing on NASDAQ Capital Market pursuant to Listing Rule 5550(a)(2).
This notice has no immediate effect on the Company's NASDAQ listing; the Company has 180 calendar days, or until June 16, 2015, to regain compliance. To regain compliance, the closing bid price of the Company’s securities must be at least $1.00 per share for a minimum of ten consecutive business days. If the Company does not regain compliance by June 16, 2015, the Company may be eligible for additional time to regain compliance or if the Company is otherwise not eligible, the Company may request a hearing before a Hearings Panel.
I can see Valero managing to turn a positive margin in this environment. It should be there. For example, as reported by the USDA, Illinois margins have tracked around $0.611/gal, while Nebraska comes in at $0.501 for the quarter to date. By comparison, using CBOT + basis for corn, PEIX is $0.320. Using the Cal corn price, it's a little higher @ $0.357.
I think we worked out, based on the operating costs sheet that was prepared and posted on this board sometime around a year ago, that PEIX's operating costs were around $0.50-0.55/gallon at that time. I believe natural gas has come down some since then. Valero would also probably incur lower labor costs, given the location of their plants.
The value of the ethanol would be less, but their corn costs would be less as well (a $1.28 basis works out to about $0.315/gallon net after co-products/gallon are factored in).
On the positive side, NK stated in the last CC that ethanol transportation costs from Chicago to the West Coast were $0.20/gallon. Looking at Nebraska, the distance appears to be around 25% less, so using a transportation cost of $0.15/gal would seem reasonable. If all other Kinergy costs ranged around $0.05/gallon, that would imply a net cost around $0.20/gal for Kinergy on the ethanol they import.
I have the one week delayed differential for Q4 pegged around $0.28/gallon for Q4 (that's pricing the Nebraska buy price a week earlier than the Cal sell price). That would suggest an operating profit of around 8 cents/gallon in Q4 on the ethanol they import from Nebraska for resale (assuming they receive the Cal Terminal price for that ethanol). Now if only we knew how much ethanol that was . . .
Of course they may receive better prices at some locations. As well, any ethanol shipped to a state where the distance is less is also going to reduce costs. So, Kinergy should produce positive income numbers for Q4. If we assume 50M gallons for the resale market, I don't think a net revenue in the $4M range is out of line. That of course excludes the revenue generated by handling charges for the portion they deliver on contract. Lets call that another $1M for argument's sake.
I have a Q4 margin of $0.875 for PEIX ethanol production. If $0.55 for operating costs is reasonably close, that would produce net operating income in the range of $0.32/gallon. Assuming reduced production in the same range as Q3, that would suggest somewhere around $14.4M.
Using those numbers, that would appear to produce a total operating income in the range of $19.4M for Q4.
Using the same number as Q3 (rounded to the nearest $0.1M):
Selling, general and administrative expenses of $4.4M
Interest expenses of $1.1M
Other expenses of $0.2
Warrant costs of $1M (I know, but they've bitten us in the butt every quarter)
That brings it to $12.7M
Taxes (40%) of $5.1M
Payment to non-controlling interests of $0.7M
Preferred stock dividends of $0.3M
Should leave around $6.6M for 25M+ shares. Ive attempted to use conservative numbers where possible. Of course, this doesn't include any unknown costs they may have incurred. Keep in mind as well that the estimate for Kinergy is, at best, an educated guess. In past three quarter, PEIX has also beaten the basis cost and managed a selling price slightly higher than the West Coast terminal price. NK also mentioned during the Q3 CC that the rail basis had climbed as high as $1.50 at times during the fall.
As for Q1 2015 to date:
Based on CBOT + Basis, I have the average margin to date @ $0.320
Based on the Cal corn price, it works out to $0.357
I have the one week delayed differential between Nebraska and Cal ethanol prices @ an average of $0.139 for the quarter to date.
Without factoring in a delay, the straight across comparison is $0.225
On the good news side of that information, that differential has improved dramatically the past 2 weeks.
If I get a chance, 'll publish the full Q1 2015 spreadsheet at some point this weekend. First though need to load a program on to my new 'puter.
Hey Value, on a slightly different topic, did you happen to observe what happened with COS.TO today? They released guidance for 2015. It came somewhat as a surprise that as a major oil sands producer, they expect to be profitable in 2015. In large part that's due to a substantially lower Canadian dollar.
While it may not at first appear to carry any significance for the ethanol industry, on reflection it does. While some North American producers are hard up against it, some are managing to do more than just survive in the current oil climate. I think the general assumption out there (myself included) was that lost production due to unprofitability will push oil back up sooner than later. While I'm sure that will happen, it may not be as quick as some would like to see. That, in turn, will continue to impose negative price pressure on ethanol. It's not the only factor, but it can't be ignored.
Here's a link to their earnings release
Today's chart:
52 Week chart:
I bought a few, then sold Feb $8 calls @$0.65 against my position. I guess I'll know next week whether it was a wise move.
On the bright side, Canadian oil & mining stocks are bouncing on encouraging forward-looking statements from Syncrude . . .
http://www.cdnoilsands.com/Media-Centre/PressReleaseDetails/2015/Canadian-Oil-Sands-Announces-Fourth-Quarter-Results-005-per-Share-Dividend-and-Cost-Reductions-at-Syncrude/default.aspx
. . . or should I say the market is now interpreting them as positive, even though they first read as negative. The drop in the CDN dollar translates into potential profitability in a scenario that was read as dreary.
From what I can determine, the TSE (or TSX, if you will) doesn't have a minimum $1.00 share price level like the NASDAQ and NYSE. For that matter, even if it did, the current share price in $CDN is in the $2.30's.
I did find this table, which would suggest there's absolutely no threat to AOI being delisted. Even in the worst case scenario if it did reach that point, I suspect it would simply move back to the TSXV. I hope these pages are legible, you should be able to click on the image to see a larger version).
Source: Going Public in Canada and Listing on the TSX and TSXV
(I can't validate whether that publication is 100% current, however the info can be validated against the links they provide in the footnotes)
I should know the TSX and TSXV regulations better than I do considering I am Canadian, but I've only been investing for a few years. Most of my investments are on US exchanges. Regrettably, due to a couple learning episodes I had occasion to become intimately familiar with the continued listing requirements for both the NASDAQ and NYSE :/
Mind you I did grow up in the Vancouver area, so I am familiart with the checkered past of the VSE (now the TSVX). It was pretty hard to grow up in that part of the country and not be familiar with such characters as The Pez :D