Eco Building Products Inc. (fka ECOB)

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It’s time for a new way to build, and what better way to begin than with the material? New buildings call for the use of sustainable materials that are sturdy, inexpensive, and versatile. While wood has long been a staple for the building industry, the older lumber ideally used in building has been depleted leading the industry to switch to lower quality juvenile lumber. As champions of good wood, EcoBlu Products believes there needs to be a change in the way we build, using the juvenile lumber that is harvested today. Using exclusive, non-toxic, eco-friendly Eco Red Shield™ coating, EcoBlu is the premier manufacturer of proprietary wood products protected against mold, rot-decay, termites and fire.

Juvenile wood isn’t like the wood that your great-grandfather used. Old growth forests rich with quality trees have become ever-more scarce, and lumber companies have been forced to use younger trees to harvest their wood. This younger wood is not ideal because it is pulpier, more susceptible to termites, and will often suffer from mold growth when it travels long distances. While older wood is also susceptible when traveling long distances, the pulpier consistency of new growth lumber is especially vulnerable to mold, which inevitably leads to rot in conjunction with the myriad of health risks posed from moldy lumber. Untreated wood, especially youth lumber used as composite wood with glue, can be flammable. In many cases when houses made with this wood catch fire it is too dangerous for fire fighters to even try to save them. Treated wood is often toxic and expensive, barring it from use as the ideal building material. EcoBlu Products is cognizant of these complications and is working to change the way builders, contractors, architects and engineers build with their new products.

 EcoBlu Products’ mission has always been to develop products that provide the best quality protection to wood and homeowners, at a cost builders can afford. It is with this goal that EcoBlu developed their patented Eco Red Shield™ technology that coats every piece of lumber they sell. All lumber, building components, and prefabricated housing units produced by EcoBlu is 100% protected from mold, termites and wood rot, and burns far slower than raw lumber. Building inspectors currently do not have a way to properly grade the difference in the quality of raw lumber and lumber treated with Eco Red Shield. EcoBlu believes their wood can compare with UL –grade wood fire resistance while costing only 10% more than regular lumber while providing the added benefit of being 100% mold, rot, and termite free. Because Eco Red Shield is less toxic than latex paint and lumber coated with it provides a myriad of benefits for a cost comparable to current lumber prices, EcoBlu believes there is currently no comparable alternative for the solutions they have to offer.

EcoBlu Products is based in Vista, California, and their lumber is offered through eight affiliates in the US and one in Haiti. The affiliates are provided and coat their own lumber with Eco Red Shield™.  They then sell their wood until the affiliate cannot keep up with the market demand at which point EcoBlu will provide their lumber as a finished product. Some catalysts EcoBlu looks to realize include: building their revenue stream from their existing facilities; expand off-shore into emerging countries that need quality lumber, similar to how EcoBlu has been doing in Haiti; provide lumber to Japan that is of superior quality in comparison to current Canadian supply (mold issues) to help rebuild; and become a finished product wholesaler to affiliates instead of providing distributors with just the Eco Red Shield™ for self-application. The current economic climate offers a good entry point for EcoBlu to gain exclusivity with builders in local markets. This economic climate coupled with increasing global demand for inexpensive, fire-retardant, mold and termite free lumber following recent natural disasters has EcoBlu ready for substantial growth.

EcoBlu Products’ value comes from the need for change and their ability to clearly meet that need. They look to gain exclusivity from builders and distributors because the coating they use on the wood is eco-friendly and low cost. Pressure treated lumber would be what the company believes is the closest competition to EcoBlu’s lumber, but EcoBlu is able to sell their lumber around 40% less than the pressure treated wood. ECOB closed at $0.20 on Friday, with a market cap of approximately $35 million and a ten day average volume of over 490,000 shares/day. Lately the stock has been climbing.  The company has announced goodwill builder programs such as Youth Build USA and the Eco Life Villages in Haiti. With builders realizing the value in buying the better lumber EcoBlu provides, speculative investors may consider the timing intriguing to take a closer look.