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Came across this article on the debate about how consultants are incentivized to overstate traffic projections. The discussion here is with regards to the Indiana toll roads but would also relate to American Roads.
https://medium.com/@nelthorpe/no-really-it-is-all-about-the-traffic-forecasts-9b6d881f11e3
Additional discussion/articles:
http://usa.streetsblog.org/2014/11/18/the-indiana-toll-road-and-the-dark-side-of-privately-financed-highways/
http://usa.streetsblog.org/2014/11/19/how-macquarie-makes-money-by-losing-money-on-toll-roads/
http://usa.streetsblog.org/2014/11/20/the-great-traffic-projection-swindle/
I don't think its due to other physicians waiting on FDA approval. I wonder if its a delay in timing between approval at a country level (Germany) and setting up reimbursement with the private insurers. My understanding of the Germany system is that now Sanofi would have to negotiate with up to 180+ insurance companies to set up pricing/reimbursement/plans.
Initials sales in Europe have been underwhelming so its not a slam dunk that they get to $400M.
Right now the market thinks its less than 50%. I think the market is wrong and bought more.
Thanks. Just 10 minutes ago it wasn't available.
Generally there are a few requirements to uplist and I don't think SYCRF are not there yet. When I looked before to uplist to the lowest of the NASDAQ levels the requirements were a market cap of $75M but the biggest was a shareprice of $3/share.
As Syncora isn't writing new business and not looking to raise funds its not critical to upgrade. I believe their plan would be to write new business and get some earnings and stability. That should improve the shareprice and then they could uplist easily. Otherwise at todays prices they would have to a reverse split which would dry up liquidity even further. The current shares outstanding already limits the volume today, less shares would make it worse.
I missed the call. For some reason I put in my calendar that the call was 8 central not 8 eastern. I hope to listen to it later whenever it gets reposted.
If they are thinking about writing new business they will need approval from NYS, correct?
NYS annual review of Syncora has historically been in the summer. I assume they made this statement after meeting with the NYS and that NYS gave them a list of what they needed to do to be able to write new business. I believe they are then hoping that they will get approval this summer and then have a few months to execute to hit the 12-24 months.
I'm guessing a bunch of people bought for the outcome and moved on no matter what. The next likely is the $400M in sales in a 2 year period which is a couple of years out. I bet many do not want to hold for that long. Also the initial sales # out of Europe have not been good dampening enthusiasm.
I bought more at $.92 as I thought it was a gift.
Here are the payments:
$1.00 per CVR if specified Cerezyme®/Fabrazyme® production levels are met in 2011 (missed)
$1.00 per CVR upon final FDA approval of Lemtradaâ„¢ for multiple sclerosis (MS) indication (missed)
$2.00 per CVR if net sales post launch exceed an aggregate of $400 million within specified periods per territory
$3.00 per CVR if global net sales exceed $1.8 billion
$4.00 per CVR if global net sales exceed $2.3 billion
$3.00 per CVR if global net sales exceed $2.8 billion
I'd prefer not but I understand if its too much work.
His posting is usually a sign that I use to buy more shares.
I'd guess close to $1.50 initially. Maybe up to $2.50 by the end of the day. There are ways over the next few years for this to get close to $11/share IIRC.
My understanding of this is the fact that we are on the OTC market. There are no direct trades in these OTC stocks you are buying and selling to a market maker.
From talking to a small cap securities lawyer when you see these blocks and the short interest on these sub $1.00 stocks its something done by the Market maker, which BTW makes the short interest here irrelevant (more later).
If someone wants to purchase or sell 50k shares they know it will take a lot of time and they don't want to just push the stock up. Therefore they will contact the Market maker and tell them that they want to buy X shares at no more than X or at the market price. The broker will then purchase stock at that price in the market and once he has gotten his 50k shares or whatever he will then execute that trade at a price that you and I will never see on L2. If that trade is at a higher price than the trading that day its a reason to believe that the guy wanted to buy and he swept up the shares and the market maker made the difference. If it goes off below that means he's selling.
Now to the short interest. Sometime it can take multiple days for the market maker to get the positions filled. Often when you see an up day and then snowball comes on here and posts 15k shares shorted what is happening is the Market maker ended the day with 15k that he owns for whomever. To offset his risk he then shorts that amount so he is neutral. When I see the stock move up and I see snowball post about short interest I get excited as that means both that somebody wants to buy, not sell, and the stock is getting away from them.
My belief for a while has been that snowball is a market maker in this stock as he only shows up when there is short interest and the stock is up. He trying to shake the tree to get somebody to sell so he can fill his allotment. It maybe crazy but I have no other reason to understand why Snowball does what he does.
My comments on utilization in the future I believe are reasonable. The plant has 2 utilization #s. The first is the # of days operating. The second is the daily capacity.
In the last quarter the plant operated basically 6 days our 7. On those 6 days where it operated it was at 73% of its permitting capacity. Clearly mgmt. thinks they can do better as they started to invest in capital in the property in Q2.
It looks like the capital work will be ongoing into Q4 based on the capital lease schedule. This is a major project imo.
I think they could get to a plan that operated 13 out of 14 days. I think that is realistic and reasonable. That would be about equal to the utilization of the plant in Q2 and below what it was in Q1.
On the days it was operating it averaged 11k/barrels per day. In Q1 when they ran every day in the Quarter with no downtime they also ran over 12k barrels/day. Historically the plant operated at 113% of capacity. Therefore I think once the capital work is done they could easily be close to 100% capacity. The 100% capacity # here seems not a design number but a permit number which they exceeded in the past with spikes over 125% of capacity. Based on the Texans I know I think 100% of this is doable.
I think you understate how much more money they could make if they could increase both their utilization by operating more than 6 days/week and getting that utilization closer to the 15k/day permitting capacity it could be worth a lot more.
Historical articles stated the plant got exemptions to run at over 17k/barrels/day in the past and had peaks of over 21-23k.
BTW, not selling here. I expect them to fix the operational issues and I think then a quarterly run rate of $.30/share is quite achievable. Other refiners sell at 7-12x earnings and most are right about 10x the last quarter annualized.
Add in a good balance sheet. If they ever wanted to be an MLP which they have looked at they could easiy have a strong dividend.
Not a material holder. I have under 100k shares. Let me know what you are thinking and if can be of help.
mrholty at Hotmail dot com
3Q numbers are out.
OI of $.08/share. Looks like Q1 was the anomaly.
Lower margins but still around 5% which are very good for a refiner. Biggest issue appears to be uptime. Their fixed Expense/barrel is climbing but still we withing a reasonable range which makes sense due to the lower utilization.
Long term the issue is that their utilization dropped again. Q1 they operated at 90 days and had a utuilization of 81%. They have dropped to 84 and now 78 days with utilization at 73%. In Q2 they started some capital investments that has caused them to spend over a $1M and they have also identified a capital lease of $500k for new equipment. I'd expect based on the value of the plant that this is pretty major. If they could get to 85+ days operating at 100% daily capacity of 15k/bbls/day that would put earnings easily at $.30+/share.
I hope this capital project works.
Story from the Detroit Papers on the Detroit Bankruptcy.
http://www.freep.com/longform/news/local/detroit-bankruptcy/2014/11/09/detroit-bankruptcy-rosen-orr-snyder/18724267/
That really doesn't make sense though. The payouts for GCVRZ are different for US and ROW. A year ago when European countries were approving Lemtrada even after the FDA denied it analysts felt the $400M in ROW sales would be very achievable.
With 3 quarters under their belt we are not seeing the update to get anywhere near the #s needed to hit that payout level.
I sized this position to be more than WMGIZ as that one was 100% a binary outcome on FDA approval. GCVRZ had multiple paths to payouts and a much potential total payout if the multiple paths were all successful.
These other paths grow full with weeds and thorns leaving us the with the door via FDA approval as our hope becoming a binary option.
Yep. There does not seem to be any real improvement in sales traction outside of the United States.
I'm pretty bummed that I bought 1/3 WMGIZ and 2/3 GCVRZ and sold half of my WMGIZ on the run up before approval.
I'd love to see a quarter where we had sales growth without expense growth that was equal.
I have a full position for me. If I saw the above I'd go heavy.
I have no idea on what the fully valued price is.
Their R&D went from a $150k in 2012, to $218k in 2013 to a run rate of $580k based on their last two quarters. I'd love to see what they are working on.
I'd like to think that is a precursor of future sales but I'm not convinced. Historically there hasn't been a good correlation of future sales as compared to inventory.
I'd really love to figure out what the increase in Property, Plant and Equipment was for. Its only a $300k increase but for them its a pretty big jump. I'd love to find out if for warehousing or a sales office somewhere. While I'm asking for more details I also want to get a breakdown of sales by region. For several quarters they have stated the majority of their SG&A increase is due to sales staff in Europe but I can't get any idea of any traction over there at all. Hopefully the increase in SG&A drives sales demand which drove the need for a warehouse in Europe which accounts for the increase in inventory.
I still cannot figure out why they sold 1M shares in a private offering as the have a strong balance sheet and don't seem to need the cash.
Their increase in R&D should be interesting to see what comes from it. I usually think it takes 2 years to get to market and the R&D increase has only been for 2 quarters.
BTW, the results are better than the earnings from GLGI.
I've added here.
Good: Sales were up by 25% vs Q2 2013.
Gross margin hit a high since Q2 2012 at 65.3%. last few quarters have been in the 58-61% range.
Bad:
Sales are down 5% over the prior quarter, Q1.
Expenses has risen as fast as cash. We can see this is in the SG&A and R&D.
Trailing 4Q has EPS of $.024. Put a 20x on that you get a $.48/share value. good.
Last 2Q with very good sales only has $.01 or $.02. Trading at 18x.
They have spent an extra $240k in SG&A and R&D in Q2 vs Q2 2013. If we had SG&A at Q2 2013 levels we would have had sales of $.012 for the quarter vs $.005/quarter. If we had Q2 2012 expenses we would have had $.02/share of earnings.
They got the markets attention by jumping their sales in Q4 2013 (Feb 28, 2014) by going up 25%. Since then they have flatlined and more negatively their expenses have grown faster than revenues. When I worked in mfg. we had a mandate to grow fixed expenses no faster than 70% of topline growth. That was manageable. I gave last quarter a pass. I can't again.
I'm not adding but holding.
Anybody see anything out there?
50k shares traded today at the ask ($.28) and there was a 10k at the same price yesterday. Yes its still small total dollars but there has been some buying demand.
Better than the 275k that went off at $.185 in early Sep.
Did you ever end up doing anything? I haven't but I need to get more variable.
I'm thinking about IB (Interactive Brokers) but I like Fido for ease of use. But if I can't buy more I'll be upset.
Am I reading the appeal on the 12th correct? I read it as justification for PBSOQ to be eligible for restitution just making it tougher to draw where the line is? That is their argument. Seems weak to me.
Do you think we get resolution this year?
With the large demand for anything with a steady didvidend, one could easily see them create an MLP with those assets and spin them off to maximize value.
Up to this I had been scratching my head questioning why American Roads was negotiating to take over the 50% of the value that Detroit owned in the Bridge. My understanding had been that American Roads as the operator paid the city of Detroit $1M annually.
In a different article this morning from the Lansing State Journal they stated it was $4-$5M annually. Now if my reading is correct we now don't have to pay the $4-5M annually plus an extension of the operating agreement out to 2040 would be huge.
I really hope American Roads tries to do the duty free thing as the Ambassador Bridge.
The other bridge is coming so our tunnel is declining asset. Estimates are that a new bridge would probably get 60-75% of the traffic.
Here is a decent blog on what is happening on it.
http://buildthedricnow.com/
Personally, I don't see much value for Syncora to take over the City of Detroit's value of the tunnel. The tunnel is split ownership between Detroit and I believe the city of Windsor.
My understanding is that American Roads operates the bridge under a long-term lease and gets all the revenue and pays for all expenses including maintenance of th tunnel. They also pay an annual amount to each city which I believe is worth $1M annually.
Saving $1M a year is worth what - $10-20M. This is not an appreciating asset, its a depreciating asset, one with a large drop off in value if the third bridge gets built which will happen. Its not an if its a when.
Politically, its probably worse to own the tunnel as well. Michigan politicians for years have pushed for a gov't owned/managed crossing under fears of a private owner. Marty and others have always pointed to tunnel as being a public owned property. If they sell this I think the new bridge gets done quicker and that is bad for the tunnel.
The only value I see is if this gets the city out of ownership would allow them to set up a duty free shopping and more importantly duty free gas like the Ambaassador Bridge. This may be what Syncora is thinking. You probably would need additional land adjacent to the land to do so. If they could do this the value gained would be huge but it would take a few years to execute.
I'm not sure if Syncora's goal is to own the asset long term or just to flip it once the economy improves in Detroit and volumes increase.
Yeah. Marty is worth a couple $B. In the 80s the automotive guys set up coordinating plants across the border in Canada for labor/labour reasons that would supply parts to US plants for final assembly into cars. Most of this traffic is carried by semi over the Ambassador bridge and the tax free fuel is a driver for lots of people. That is a $.60/gallon savings.
Here is an article as part of a bigger issue about the entire Ambassador bridge issue.
http://www.freep.com/article/20110425/NEWS06/104250381/Tax-free-fuel-sales-bonanza-Ambassador-Bridge-owners
The problem with Marty is that he was supposed to pay for the connection of his bridge to some renovated interstates on either side of his bridge and he didn't wanted each Federal Gov't to and that is against his charter. He's now pissed off both Federal and state gov'ts, local gov't so they all are aligned against him. The big loser will be the tunnel, imo.
Article on exporting on Condensates.
http://www.reuters.com/article/2014/09/03/oil-exports-pioneer-idUSL1N0R41IL20140903
If this happens in volume this will eliminate the low price due to excess production and capactity constraints in the US which helps BDCO.
That said I think this is a few years out before it becomes a real issue.
Stock is still drifting lower with overall oil prices.
I got to say that DAL has the best mgmt. in the airline biz right now. (And I thought there foray into the refinery was dumb/still do somewhat).
My biggest problem is Richard Andersen the CEO of Delta and former CEO of Northwest. I worked for Northwest at one time and had a few meetings with him. I don't like him and that is being kind. However, I'm also not a fan of Jeff Smisek at UA. If either Gordon Bethune or Larry Kellner were around I'd bet on them but they aren't.
The consolidation of the airline industry into the Big 4 plus some minnows should allow them to not fight with capacity wars.
Delta will control the SE via the ATL hub. They are regrowing the Pacific which they have grown and shrunk many times when it was NorthWest Orient. Its a good move to grow into 2nd tier cities in Japan if they can get non-stops out of SEA to those cities as they have 5th freedom rights in Japan as it will increase their utilization. The guy in charge of route planning and scheduling came from Continental when CO built their Newark Int'l hub to fly narrowbody AC (757s) to 2nd tier cities in N. Europe which was/is successful. He brought over a bunch of staff and optimized flight schedules to revenue opportunities. Previously DL ran the same schedule 7x a week. He runs very different schedules especially in the weekends. This requires more coordination on maintenance staff/etc but if you try you can make it work.
Add in soon to be news release that Southwest ETOPs planes are going to start flying to Latin America out of Houston Hobby and that will hit both American and United hard (especially United).
There is no sunk tanker. Let me repeat that THERE IS NO SUNK TANKER.
The tanker turned off its tracking beacon. The ship full of Kurdish crude had filled up in Turkey via a pipeline that was recently constructed between Kurdish controlled areas and Turkey. This pipeline has been a source of dispute for quite awhile between the Iraqi government and the Kurdish government. Currently the Iraqi's gov't position is that the Kurds can produce their own oil but have to remit royalties back to Iraq as they are an autonomous region within Iraq while the Kurds feel it is their oil period. When the Kurds were using the oil just in country it was not a big deal but once they exported it it means lots of money to the Kurd gov't. More money equals more autonomy. More autonomy means push for its own gov't.
This tanker had sat in the Gulf of Mexico in international waters just outside of Galveston as it was to unload its raw oil to a US refinery. The US refinery, many believed to be Lyondell (as they have admitted buying Kurd Oil previously, wants to turn it into tons of stuff and sell it. They were probably willing to take it at a discount. The Iraqi gov't flew to Houston after tracking the ship leave Turkey and cross the Atlantic and filed an injunction in US court that the oil was rightly theirs. The tanker sat for a few weeks to see if this would play out via negotiation. (A US court wants to stay out of an Internal Iraqi dispute). my guess is the owners of the oil were sick of waiting and found somewhere else to take it and didn't want to deal with the Iraq gov't thing again so they turn off the transponder and leave in the night. It will show up in a few days empty having unloaded it oil to somewhere at a bigger discount.
There are lots of Latin American countries that used to get cheap oil from Venezuala for their energy production. Venezual gave it to them for diplomatic pull and now that has dried up and they are struggling. Nicarauga is a good example of a country that has this issue.
Well they have until the end of tomorrow to either file an NT 10-K or file the 10-K. In 2011 and 2012 they filed 2 nights before the end of the month. If that holds we should see a filing tonight. Last year they filed mid day on Friday.
I tried to put in a bid of just a 1k shares at.19 to see if I could get it filled as there was a trade that went off at .18. Got notice to call fido. Spent a while on phone with 3 reps including a trading rep. Said only sell no buys. Had a list of pinks.
I'll probably move not sure to whom.
I've learned that Fidelity isn't allowing any more buying of PBSOQ only selling.
Its on a list on pinks that they want to get out of the business from.
Thanks for the note on PDNLB. Unfortunately it doesn't look as skeevy as I normally go for.
Tell me where I have it wrong.
Only asset now is some cash + property in Mass that its trying to sell. Google tells me they have it listed for $4.9M.
The business will basically be breakeven if it can sell environmental tax credits to the state each year (haven't seen if that is true) otherwise they will lose a few hundred thousand.
The income from Broadway Partners Fund II in May and June is interesting but one doesn't know if that is a new dividend or a one time payout. It appears that fund was funded in 2006 so at the height of RE values but it was only a $1M investment. With the high-end RE market being hot lets say its worth its $1M.
Total liquidation value - $.5M + $4.75 + $1.00 = 6.25 less $1.8M = Net $4.45M / 4.3M shares + 1.7M options = value of $.70 less fees so maybe its worth $.5M.
Is this what you are thinking or do you think they will actually execute on their plan to borrow and grow multifamily properties. That has been the boilerplate for a while and no execution. Am I missing something?
Thanks Trepanne-
I'll take a look. I like to try and find interesting things. That's half the fun even if they never pay off.
You're right - You can never make them a large play so even if it does pay off it really doesn't mean much but there is some satisfaction there.
You got any other nuggets that you are looking at today similar to back then?
Thanks. I often to forget that.
I know you love it when businesses screw over their shareholders. Have you ever looked at WGCBP? Its coming to a conclusion but the balls by Goldman in this have been huge.
Yeah. It sucks. I think this is their full and final offer.
Its even worse than that. By their behavior they got shareholders to sell to them at a discount due to their behavior.
Unless the SEC steps in (and I don't see that they will as they are all lobbying for jobs at GS).
MF'ers.
Trep- You used to post on the Berk board on the fool.com? Do you post anywhere else now? I enjoyed reading you over there.
Its also interesting to whom is buying today. The letter stated that you had be a shareholder as of the 22nd. I assume they will get paid but its risky. I wonder if my sale on the 21st is still good as it should settle today.
BTW, I bought a few thousand more yesterday but not at the low. Under $6.50 I'll take it. ;)
Actually in a period of rising prices items that were purchased at spot and then sold later should provide a better margin. When prices are falling and ones input is higher than when it comes out on the backside is when we should see margin compression.
That said their finished inventory only looks to be about 4-5 days. I wonder how the new EPA requirements is hurting any margin (even if it was low before) on what they could sell as off-road diesel and now it basically only marketed as oil mud. However I believe what they were selling to was simply being blended with other diesel.
God I wish they would respond to investor inquiries.
I want to know if the $2M of capital is to bring up the diesel back to being saleable or if its an attempt to increase the efficiency to get the plant above 12k bbls/day or closer to 15k.
The plant had a conditional permit from long ago to go up to 17bbls (not 15k/day) and an article I saw stated that at peak it could do 21k.
Congrats. I sold my 100 shares yesterday to buy more BDCO as I viewed them on sale yesterday.