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Clean Diesel Technologies Inc. Message Board

  • spanspur spanspur Dec 30, 2012 3:58 AM Flag

    Spanspur Research, Inc.

    Strong Buy/Accumulate Now

    Honda Total U.S. Sales..............

    2005 1,462,472
    2006 1,509,358
    2007 1,551,542
    2008 1,284,261
    2009 1,150,784
    2010 1,230,480
    2011 1,147,285

    In 2010 Honda produced 12.9% of the world's automobiles.

    Spanspur believes that revenues will triple within 18 to 24 months. Furthermore the company is in my opinion is Undervalued. Current naked enterprise value is approximately $25 million. I view the company as being worth a minimum of $60 to $75 million today. And perhaps 10X that figure within 5 years.

    CDTI is poised to achieve per share profitability for the first time in the company's history. With only 7.2 million shares outstanding, and perhaps 8 million when factoring in existing and future options, the magnification of bottomline per share performance will be evident as revenues from the yet to be completed licensing agreement with Honda are delivered. The new manufacturing facility in China is just beginning to come on-line. At the last CC, CEO Craig Breeze made mention of the "projects that are on the table". It is our belief that he was referring to additional Honda models that will be using CDTI's patented technology.

    My optimism is easy to understand. Additional units mean increasing revenues. The capacity to produce additional catalytics, for let's say, the North American Civic already exist. The plant in China will add more capacity for Asian/Foreign markets, and perhaps some North American supply. Under a licensing agreement, one would assume that CDTI will receive a per unit fee for supplying the technology, overseeing future innovation and quality control. Interesting to note, CDTI has never had a recall for any of their products. Management is focused on insuring that all components of catalytic production are right.

    How much will CDTI receive per unit under the licensing agreement? No one knows. I would speculate that it will fall somewhere between $20 to $60 per unit. Suddenly, there is excitement in the air.
    Merely do the math.

    Spanspur was favorably impressed with management. The entire team is capable and ready. Management has cut operating expenses significantly. The nasty reverse split is out of the way. CDTI is a classic example of a company that is about to experience a dramatic growth phase imo. An American engineering company succeeding through innovation, working with a long time trusted Japanese partner.

    Spanspur has taken a meaningful position in the company.

    Sentiment: Strong Buy

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