Gulf Alternative Energy Corp. (GAEC)

[zekel]

Speaking of Chet Gutowsky (remember his glowing independent analyst opinion he wrote about GFET?). Appears he ran the same type of operation for sister company AEND - seems like his expertise in the energy industry not only applies to Ethanol, but is also an expert on energy drinks:

Let's look at a few of the "facts" that were touted by Mr. Gutowsky in early October 2007:

http://www.havocenergy.com/investors/downloads/20071003_Analyst_Report.pdf

Valuation
"The following companies were used for our peer group analysis: Jones Soda, [JSDA], $12.06; Hanson Natural, Inc. [HANS]; $56.60; Leading Brands, [LBIX], $2.75; Sweet Success, Inc., [SWTS], $0.23 and Reed’s, Inc. [REED], $7.05. The average share price for the peer group is $15.74. We believe Havoc, although under the radar of the market, has laid the foundation necessary to perform well against its peer group in price appreciation over the next 18 months."

Definition of "peer group": something of equal worth or quality - not sure why any of the Nasdaq listed stocks above would even remotely be called a peer?

Price Target
"At a recent $0.85 per share, Havoc [AEND] lags its peers in price to value in the market. As the Company steps out of the shadows, we expect the market to realize the buying opportunity represented by AEND. As a result, we are initiating coverage of AEND – Havoc as a strong but speculative buy and hold. We target price appreciation to $3.40 by the end of the fourth quarter."

Results: $0.15 on December 31, 2007

"Havoc has taken the creative step of acquiring a 35% ownership stake in a captive distributor – Dynamic Distribution, Inc. that focuses on distribution to convenience stores and clubs."

What it fails to mention is that Dynamic Distribution is yet another shell of a company operating out of the Blalock office suite in Houston, that is also home to Southfield Energy, Telemedicus, Oxford Funding, Gulf Ethanol, Autofund Leasing, Alternative Energy Technology Center, Galleria Securities, etc, etc, etc..... Dynamic has no functional operation at this location other than a mailing address.

"Chet Gutowsky is a Chartered Financial Analyst (“CFA”) with over 30 years experience in banking, business and investment evaluation. The views expressed in this report are those of the analyst and are based upon publicly available information on which the analyst has relied as true in the formation of his opinions. No part of my compensation is, or will be, directly or indirectly, related to the specific recommendations or views expressed in this research report."

Well, as I have already documented, his objectiveness is immediately compromised by his association with Gilchrist and Carmichael: http://www.southfieldenergy.com/our_team.html

Chet was touting Dynamic Distribution with several misleading statements:

"...AEND owns a 35% interest in beverage distributor, Dynamic Distribution based out of Dallas, Texas..."

Note: Dynamic is based in Houston

"...independent distributors and through its captive distributor, Dynamic Distribution, Inc...."

Question: what makes Dynamic "captive"?

"....Havoc has taken the creative step of acquiring a 35% ownership stake in a captive distributor – Dynamic Distribution, Inc. that focuses on distribution to convenience stores and clubs. This gives the company dedicated, product specific distribution and marketing in a single package as jobbers call on stores and clubs specifically selling the Havoc product...."

This is in direct contrast to the Company's own financials that admits this Houston [not Dallas] based company is in fact a "developmental stage" company with no such distribution network:

"...the Company acquired a 35% interest in Dynamic
Distribution, Inc. ("Dynamic"), a development stage beverage distributor by exchanging services related to the startup of Dynamic...."

The "exchange services" is unknown to us nor is the company structure of Dynamic known to us (except for the mailing address). One could speculate the regular routine of getting stock at par value to Carmichael, Gilchrist, and Gutowsky, who office out of the Blalock suite in Houston or perhaps worse, a disproportionate share of the profits from AEND through the ruse of "consultant fees".

Can anyone figure this out?