China is a valid concern. I’m looking at this as more of a trade so if they ship this quarter which it seems they are I’m just depending on an earnings pop.
Also of course there is an additional .04 or so of upside if they get China back to previous numbers. The downside is we don’t know if they are even going to ship my proposed million or so. They reduced the formulation from 12% to 6% so there is always the possibility nobody wants a weaker formulation. Also might make it cheaper to manufacture that way.
Personally I think I would add more if I could get it around tangible book value. That would mitigate the downside.
Company just issued a press release- they just shipped a 2 million dollar order to PG&E. This will eliminate all of the client deposits on there balance sheet in which PG&E already paid them cash for in prior periods. There balance sheet will be clean again and they should be able to report a very profitable Q4 with sales exceeding 2 million from the shipment of this order. Hopefully PG&E orders more from them! They also are still suppliers for schlumberger but the orders for the voraxials have been slowly than they initially anticipated.
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