I guess it depends on each individual's entry price, but just comparing the opening price to the closing price for 2016 and YTD for 2017, there was a 17.6% and 13.4% increase respectively. That's not a bad return if you bought on 1/1/16, and I don't think it supports the notion that "we have floundered around this price for a couple of years".

My unrealized gain is higher than that since I bought most of my shares a lot earlier than that. However, I have to admit that I am quite disappointed in the current price and the slow growth of the price relative to the growth of revenue and profit. I have argued against selling the company as a whole, because I'm quite certain that such a sale would not be at a price that would make most of us happy. But your point is well taken, that the next level is in the .70s. I do believe an outright sale of the company could produce a price at that level. Maybe not such a bad outcome.

Yes, and let's get there organically, no more RS please.

Here's a link to the Initial Listing Guide for Nasdaq. It's not as easy as just reaching $2.00. There are lots of requirements that need to be met before you qualify. I wouldn't want to rush into this if I were Stewart. Even if we were able to get approved, I would want to be strong enough to limit the risk of failing to maintain the ongoing requirements to stay listed for the long term.

https://listingcenter.nasdaq.com/assets/initialguide.pdf

Not going to happen. We won't hear from management again until the official earnings release.

I read all of yesterday's posts this morning, and have some comments regarding several of them. I decided to just go back to the first one in this line of commentary.

First, I don't think very many investors are concerned about the share structure. If investors want fewer outstanding shares, then the reverse split that we all think was a mistake, would have resulted in some price growth. I also think that investors would see the good side of insiders holding a lot of shares, that being that they are incentivized to improve share value.

I think a sale of the company would result in a significant disappointment for most long term shareholders, because the price would be significantly lower than people here seem to expect. No way anyone is going to buy this company at more than $1.00 per share.

I like the dividend idea, but, unfortunately, we will need a couple more years of profit before it would be possible. There are no retained earnings with which to pay a dividend. Of course, you could use current year profits to pay a dividend, and ignore the accumulated deficit. But I think it is more important to reinvest that money into the current growth of the company's operations.

Once again we have completed a quarter, and 5 working days or 9 calendar day into the new quarter, we have no idea what the sales were for the quarter. I know the books are not yet closed on Q3, but the sales number is known internally at Capstone. Why don't they share it?

I've been very frustrated as well, with the lack of price movement. I've commented before about the small size of Capstone as a company, and the fact that we are in a weird transition between a penny stock company and a serious, profit making company with a real business model.

Most penny stock companies are either startups with a lot of hope, or companies that bounce around different business models trying to find their way, much like CAPC was in the early years. Capstone is a real business now, with real products, real sales, and real profits. This is a new situation, relative to the history of the company, and a lot of us got very excited once we realized that the company had found their way.

I remember a year ago or so, I posted some messages about how investors need more than one quarter, or two quarters in a row, of positive results before the price would start to climb. I always thought that, because the favorable performance was new, investors would need to see 4 quarters in a row, a full year of results. Well, we got that, and then two more quarters afterwards. Still no meaningful price increase.

So, I come back to the size of the company. The things that Stewart is doing to try to attract investors are the right things if we are twice this size or larger. But we aren't. Maybe we will be soon, but for now, investors just don't see CAPC as a large enough opportunity to make money, if they see us at all. Maybe Q3 will provide a small spike if the performance is really great. Maybe the full year, now two years in a row of exceptional performance, will get some more serious attention. I sure hope so. But the bottom line is that long seems to be longer than some of us would have expected.

Salve, your points are well taken. In the current situation in Texas, where people are trying to flee the flood waters, there doesn't seem to be any Capstone product that would be very desirable to most.

However, I had a different impression of the CPC bulb. I was under the impression that it would last 3 days under normal use, or more if you use it sparingly. Not sure if that qualifies as sustained in your view. But when I was left without power for 3 days after a hurricane in Florida, I sure would have liked to have had one or two of them. Of course, I would not have been home to use it if my house had been flooded like many in Texas today.

I agree Mike. There are many actions that could be taken at this moment, to help the people in Texas and increase sales at the same time (not to mention increasing consumer awareness). I just don't believe that Stewart sees it that way. I think he wants Sam's Club, or someone who already bought the product from him, to market the product however they see fit. Then place new orders to restock the shelves.

Regarding the design of the CPC bulb, I would guess that Stewart's customers (Sam's Club and other big box stores) wouldn't buy the original design because they didn't think they would be able to sell them. I would be really surprised if any consumer opinion was part of the design effort.

Not saying that I agree with the strategy, but I think Stewart sees his customers as big box stores and duracell/hoover. He doesn't see consumers or end users of the products as HIS customers or Capstone's customers. Consumers and end users are the customers of the big box stores, not customers of Capstone.

I don't think very many consumers even know of Capstone as an emergency lighting company. If they don't happen across the products in their local Sam's Club, they don't know the products exist.

I do think that there is still a big opportunity here, for sales in the aftermath of the storm. People have emergency items on their mind for some time after the emergency is over. Unfortunately, I don't think we will take advantage of that opportunity.

Hopefully

I missed it too. Had to go to the company website to find the 10Q/A.

How about a press release? I don't think any new investors are going to find this stock if there isn't any news.

It was a wannabe social media app a few years ago that never made it. Something about "monetizing" celebrity videos, so that the celebrity would be able to make money by posting videos of themselves. They were trying to sign celebrities to contracts, but most of the celebrities they had were people I never heard of. Anyway, it seemed like a valid concept at the time, so I took the risk. Bought some shares on a pump & dump, and mistimed the dump. After that, I figured I would support the company by downloading the app to my phone, and logging in a few times a day. Pretty soon afterward, their web site disappeared, and the app stopped working. It's been dormant for a couple of years at least.

That's my version of history.

So the question is, what is he going to do with it now that he has it?

I agree with everything you said in your reply, Uranium. It doesn't make any sense that Stewart would be shareholder unfriendly. Yet the attitude on the call sure gave that impression. Maybe he is preoccupied (distracted) by some other piece of Capstone business, as others here have speculated. We can only hope.

I'm also glad that his primary focus is on growing the business. But I feel that there is a lack of understanding about how to promote the stock, or at least how to maintain a certain level of interest.

I think it is more likely that the sellers today didn't like the call itself. That conference call gave the impression that Stewart doesn't care about shareholders or the pps. Maybe some shareholders have had enough of that.

Based on the operational performance, we should be seeing the stock go higher. But based on the attitude displayed on the call, I can understand people giving up on it. I still think we will continue to see long term pps growth, but today is a big disappointment.

Nothing but good news on the call, but still a terrible call. No questions, not even email questions answered on the call. That might have been the shortest call I've ever heard.

Man, I've defended these guys on their IR strategy, begging for more time to let it materialize with the investor conferences and such. But some of this stuff is so simple, and they don't do it. No PR in between quarterly releases is unacceptable, and that call today was insulting. We should be seeing a spike after that operational performance, but we're moving in the wrong direction after an embarrassing stage performance.

Painful!

Mike, the problem with your theory is that Q2 ended 45 days ago, and they knew the Q2 revenue number on the first day of Q3, even if they didn't know the Q2 earnings quite yet. If the revenue was good news, they should have released it when they knew it. That would have avoided all of the head scratching and hair pulling in the investor community over the last 45 days. And, the price would have been a lot more stable over the last 45 days. We would likely be entering the trading day tomorrow at a higher starting price, resulting in a higher ending price after tomorrow's spike.

This is a great point, diz. The profit growth has been driven by the sales growth so far. We need to see the margins going up as well, as the sales volume increases. The profit should be rising faster than the sales. That's another factor in driving the share price.

I think you would be disappointed in the price if Capstone was to be acquired by another company. Valuations for such a transaction are not the same as valuing the potential trading price on the stock market. Based on my calculations, I can't come up with a scenario where the purchase price would be more than $1.00 per share. And if I were the M&A guy for the acquiring company, I would recommend a much lower price, probably in the $0.65 range. Depending on the level of desire, that could possibly be negotiated up to $0.80 per share and I would still call that a win (for the buyer).

The big problem is that Capstone is really small. If you were going to buy the entire company, let's say at $60M, with the current earnings, your payback would be 12 years. Of course, they are growing, so the payback is faster than 10 years. But there's risk associated with their growth potential, and even if they continue on the same growth path, the payback on the $60M is not that fast. These are the things acquiring companies look at.

Yes, the pattern this quarter doesn't exactly match the last several quarters, where the company came out with an early announcement that the quarter was likely to be better than expected. This time, only crickets can be heard from them, and there's only today and tomorrow left to make an early announcement. It does make one wonder if maybe the quarter isn't as good as we hoped. Hopefully there is another reason for their silence. I guess we'll find out on Monday.

rvd, I didn't validate any of your beginning and ending prices, but just comparing the prices you gave, which you seem to be happy with, to CAPC for this year, some are better and some are worse.

CAPC 0.44 0.53 20.5%
Dow 18500 22000 18.9%
Nasdaq 5200 6400 23.1%
JPM 65 93 43.1%
LLL 150 180 20.0%
PM 100 115 15.0%
FB 130 170 30.8%


Again, I'm not saying I'm happy with the current price. What I'm trying to say is that it isn't as bad as some may think. A 20% return on less than 8 months is certainly acceptable, and some may even say exceptional. I'm looking at the progression of the price since the start of the current operational success, and basing my "happiness" with the price on that window.

I fully expect a spike next week after the earnings announcement, at which point, the price will be much more in line with the company's performance. After that though, if Stewart holds to his strategy, the price will slowly decline until the next announcement 3 months down the road. That's the pattern we're in. It could certainly be improved by having a better investor promotion model, and I think Stewart wants to have that. I just don't think he quite knows how.

I haven't read any posts indicating that anyone here thinks this share price is Great. Everything I read indicates that we all think this company is significantly under valued by the market. But I still feel that the YTD share price performance is acceptable as compared to a typical investment. The price performance since I bought my shares (2008) was terrible for a long time, but I'm significantly in the green now. Comparing to a fleeting moment when the price might have been $0.23 (pre split), isn't exactly reasonable (unless you bought your shares at that price, that is). Is your value growing or not?

Over the long term, the price performance has not been good. There is no denying that. But the operational performance has only been good for 2 years at best, and it takes a long time to convince investors with a company this small. In those two years, the price has gone from around $0.25 to $0.55. As long as the price continues to climb as the operation continues to grow, I'm going to stick around. I obviously want the price to be better, and I obviously want Stewart to come good on his promises to enhance shareholder value. Only time will tell if those things happen.

Sounds like a valid methodology to me Salve. If I'm right about Stewart's game plan, you'll make some money when the price spikes after the earnings announcement.

I agree chdobull. The volume is good news, even if the price isn't going up (yet). The people who sold today probably made a decent profit, and the people who bought today will not want to sell at the current price. Eventually, this will drive the price up.

I don't have any inside information on CAPC, only on the company I work for. I'm not planning to participate on the call, since I'll be working. But I might listen in if I get a chance. Usually I have to listen to the playback after it gets posted.

My position hardly puts me in with the wall street elite. I just report numbers, which makes me an insider because I see the numbers before they are reported. But I do see how investors react, and my company has internal guidance for producing the external guidance.

Anyway, the micro/nano caps are kind of fun.

Regarding the favorable surprise, my conclusions are based on history. Stewart is very conservative with his guidance, and then hits us with a surprise each quarter (at least the last several quarters). This quarter seems to be setting up the same way.

As an insider in a large public company, who is responsible for reporting performance and outlook to the street, one rule of thumb for such reporting is NO SURPRISES. That means that missing OR beating your guidance is bad if the variance is large. Investors like to see that you have a good plan, and they don't like significant favorable misses any better than significant unfavorable misses.

I don't think Stewart understands this. I think he wants to hold the news until the conference call in order to try to hit investors with a huge favorable surprise. But investors don't like to see such surprises. They would rather know up front that you are going to have a blowout quarter. Then when you perform to those high expectations, that's something that investors will buy into.

As long as they hold to $0.18 per share (or better) each quarter, I don't see a reason to get out just because the payment will be quarterly instead of monthly.

Where did you get this information? An official report from the company?

So this buyer vs seller analysis has been bothering me for some time. I have done a bunch of research, and all I can seem to find is that buy volume is the count of all of the transactions where the price went up, and sell volume is the count of all of the transactions where the price went down. So if more shares were traded going up, then there are more buyers than sellers.

Hopefully I have that right. In any event, I guess its the syntax that bothers me. In actuality, every transaction has an equal number of shares bought and shares sold. In the case of CAPC, I like the volume. Even if the price goes down, if someone is selling, someone else is buying. That means there is interest. The only problem is that the interest is at a lower price than we think is indicated by the company's performance.

But I finally see what Townie is getting at here. In order for the price to start climbing, you need a situation where sellers must be enticed to sell by a high bid, as opposed to a situation where buyers must be enticed to buy by a low ask. For some reason, there seem to be a lot of buyers interested in CAPC at a low price. When the price goes up, the buyers disappear.

I'm pretty sure someone bought all of the shares that sold so there is interest at this price. The question that Running Bull keeps asking is why anyone would sell at this price, given the fact that the price is bound to go up in 2 weeks. I wish I knew the answer to that one.

Lot's of frustration building on the board lately, which I share. I know Stewart doesn't believe in fluff PR, but something must be happening in the company that could be communicated without any fluff.

Having said that, I still feel that the YTD price performance is good, and I also believe we will get another bounce after Q2 numbers are finally released. I just don't like the silence for such a long period of time.

I also feel like there is a transition taking place with CAPC that doesn't often happen with penny stocks. Most penny stock companies are startups and wannabes that never turn into companies that have long term revenue and profit growth (most don't have profit at all). Capstone has moved past that point, as we have all recognized. But the transition from a penny stock to whatever you want to call the next level up, is something that Stewart is trying to manage. The reverse splits, the up-listing, the strict adherence to the no-fluff policy, the banking and investing alliances, and everything else he is doing is evidence that he is trying to NOT be a penny stock. I guess we'll see how that ends up if we have enough patience to wait for it to play out.

I'm not really in favor of becoming a giant that way. If I wanted to own stock in Phillips Lighting, I would have already bought it. The problem with being swallowed up by a giant is that the Capstone subsidiary or product lines might have exceptional growth, but that growth will be invisible within the operations of the giant parent. This in turn, reduces our potential for return.

However, CAPC's stock price might explode if we could find a company around our size to acquire under the Capstone name. I hope that's where we are focusing our strategy.

It's pretty hard to define "giant", and I kind of think it was a mistake for Stewart to say that. We are in a huge industry, with REAL giants. For example, Philips Lighting closed 2015 with 34,000 employees and $7.5 BILLION in sales. That's probably a good representation of a giant, and I don't see us ever approaching that size. If you compare us to other niche companies that sell consumer lighting products with LED integrated into them, then maybe we can some day be considered a giant within that narrower group.

Good for you traderbbc1. I don't have any more money to invest, so I'm only going to be happy with price increases going forward. Today was painful for me.

Ouch!

Not offended, and not worried either. Still confident that the company is moving in the right direction, which will eventually translate into stock price also moving in the right direction. But a little bit frustrated right now, and more just confused as to why anyone would be selling if they know the story.

Watching is what I do. Not watching would cause more anxiety than this price stagnation. But that's just me. Whatever works for others is what works for them.

I know. I could make a nice profit myself if I sold at $.57 or $.59. But I'm holding out for a much larger profit when we finally see the price that reflects the value of this company. I guess some people just can't wait, although I will say that volume is down, and those sellers at $.61 are struggling to find a buyer.