QS Energy Inc (QSEP)

[Zizek]

My biggest takeaway from the 10-Q was the EPS. Year over year it improved from -0.09 to -0.02. We can lament the talk of CEO raises, but it is objectively true that they are being more careful with their money while devoting more resources to the R&D budget.

STWA operating expenses were $1.75M in Q3 2013, and $2.36M in Q3 2012, a net-savings of ~$600k. This allowed them to double the R&D spending to $563k in Q3 2013 from $249k in Q3 2012 while still reducing overall spending. So keep shouting those spending per month figures without context to prove how mismanaged the company is. After all, you've never been one to let the truth get in the way of a good argument.

As for the upstream, I was doing some research on this today and I'm not convinced this is as big a deal. The AOT Midstream units are solving a problem no other company is able to fix because of the size of the midstream pipes. On these smaller upstream pipes there are already various magnetic treatments currently in use (e.g. Azure Innovations, Mag-Tek, probably others) which people seem to be happy with. Plus, smaller pipes means smaller profits. Using the published numbers from these companies, the installation of a magnetic upstream solution might mean an increase in profit of ~$15-20 million annually for an area with 8 active wells. Obviously these solutions are a good investment for the upstream operators, and if STWA were able to court a lot of these companies that would be great. But for now, I'm more interested in focusing on those pipelines AOT alone can improve, rather than competing with already established companies.