God bless all the MBLX employees...may the fruit of your labors make us much money so that we can do good things locally and internationally.
ADM...Illinois connection... I bought this stock in anticipation of a worldwide contract with McDonalds Corp. for all their plastic needs...cups, bags..
ps:if Ronald wants biodegradable cups, then so will Wendy's and BK.
I would expect that MBLX's product would be widely
contracted for by the fast food industry. It's simply
A big reason why I am long on MBLX
You might be waiting a while. These characters don't have any manufacturing process or customers. The closest you might get to McDonalds for the next few years is the management team running around with red noses and floppy shoes. Good luck with that.
Reasons for being long on MBLX #1 Biodegradable Plastics are the future #2 Metabolix holding several patents in Biodegradable plastics #3 Plant in Clinton,Iowa should be up and running and making money by Nov.07 #4 ADM holding stake in company #5 Potential takeover candidate by Adm down the road
I doubt they could even come close to supplying McDonald's when their new plant comes on line. But I'm betting they have a great shot to just that down the road. And I bet they will.
Nice thing about buying this stock now. It's an investment. Not a trade.
It's a tough call because we're in the hole-digging period before the revenues arrive in 2008. But, let me suggest what investors should be looking at:
MBLX can generate $150M revenue/year.
+ 110M lb/year plant is ready by mid-2008
+ All orders filled (plastic demand remains high and MBLX's PHA remains a decent plastic)
+ Factory revenue share to MBLX remains at 50%
+ MBLX sells at $2.8/lb ( http://www.ides.com/resinprice/resinpricingreport.asp )
Yes, they plan to push the Natural Plastic brand but I'll believe its effect when I see it. It's more likely the government will enact biodegradable usage requirements and subsidies to companies who consume biodegradable plastic. Depending on how it's done, it'll either help keep MBLX orders filled (more likely) or allow higher pricing.
As for skyrocketing costs...
Even if MBLX wants to double SG&A+R&D to $8M (w/o stock option) by 2008 these costs appear well in control (I have faith in the MBA's running the company).
But it's still a deep hole.
If MBLX only performs at the 3.5% plastics industry operating margin, that's $5.25M op income. That's 10 years until break-even! Ouch.
Revenue and demand are excellent.
MBLX's PHA is far superior to Dow's failed PLA.
But I won't assign a strong buy unless MBLX gets help on the hole, through government grants, further ADM partner assistance, etc. ... or signs that their branding or operations can beat the industry average.
MBLX are currently where they are because of ADM. We should accept this as a fact. They still have no manuafacturing process, no customers and therefore no products. This is reality. Any value is based around future value of the technology which will only become clear when they actually produce something.
Management are well trained in the spin, but let's not get too carried away until they produce something. At $2/lb, it's a big premeium over PE, PP or PET - we have a long road ahead. Good luck to all.
I have come to respect Herb Greenberg's opinion on stocks and general economic issues. While he tends to take the cautious approach, he does on occasion write about positive things of some companies. Today Metabolix got the rare nod. One can read about it at the following: http://blogs.marketwatch.com/greenberg/2007/03/mulling_over_me.html.
I will some digging on this company and may take a long position. I certainly like its business objectives.
Yes, I saw him on CNBC yesterday singing the praises of MBLX. So now I'm watching and learning, may buy some soon.
Anyone who doesn't take time to listen to Herb and listen well, hasn't been around long. I am most surely his biggest fan. A different breed in a world of greed. He deserves more respect for what his intentions stand for. As for this stock, plenty of cash to see it through with products comming in 08 that will surely be used by lots of companies unless they want to lose business. A must own in my opinion with time to build a nice position.
Did some calling around and there is more than a high probability of big street money going into the stock after the company's announcement yesterday. Therefore, I'm going to start accumulating now, before the well funded firms start buying.
I'll keep an eye on Metabolx but for now it's been too volatile with nothing material to show for it.
I started a small position in Metabolix today. I like the company's mission and generally like the valuation. I would clearly not consider it a widows and orphan investment, but I believe the price is low enough to warrant a speculative play. I have bought it for what I hope will be at least a three to five year hold. I appreciate the feedback from the past day. Just4thinkin'.
I have zero respect for that herb g. guy...IMHO opinion he has coluded with shorts to write hit pieces on several stocks.
Still, I like this company very much, and believe it has a very bright future. I am investing in it for the long run too (i.e. 3 or more years). The valuation is attractive, and I believe the share price will significantly increase once the first commercial plant starts to operate in 2008.
How is Metabolix not up on this news? They've got to get to ramp up production fast before other alternatives are found!
same here i figure the shares prices would move on SF banning plastic bags.
in Korea, they charge the customer about 100won-250won(.05-25 cents) each bags..