A long time ago, perhaps too long for my current memory or interest there was this story about the Bell and the Cat. Let's give it a more current twist. The Mice Company had a meeting of the Board or was it the Bored.
Their search for food, mainly from pantry cheese, was being interrupted by that monster (mice perspective) Cat that sidetracked their search. The threat of being eaten was too much. So they called a meeting. After long and arduous discussion of complaints they pasted a resolution that to save the day a bell should be hung on the cat. That way when the bell rang, they could flee the cat and race to the security of their den. Just one problem remained. WHO WOULD HANG THE BELL ON THE CAT?
Our message board and I include my comments from time to time remind me of a bit of futility. We discuss and discuss and discuss what's wrong with ESPH. Is it the industry, the chemical companies, the drillers slowness to change, execution, sales, Hydronix, ICR, or is the fault really the management, viz. Dennis and salary? We all have complaints, myself included, but "Whose going to hang the Bell on the Cat?"
My biggest problem is I am still trying to understand this "Cat?" One fact is not in the equation. Adoption of the technology, licensing agreements and resulting revenue. "Does Dennis pay himself too much?" knowing how public companies function, the answer is simple. CEOs try to protect stock and their survival by options and salary from the shorts in the market. Is Dennis the Cat? NO! Revenue is. If the revenue was rolling in the board would be silent because the stock price would blow out the upper end of the charts. Instead of a Cat he would be the Catalysts or the hero. Is this a defense of Dennis. No way. He is dismayed at the price of the stock as we are. Instead, I am looking for ways to get other Companies to reconsider this technology. I am in touch with Hydrozonix. I meet with Dennis on occasion. I'm still in the search.
Eagel---I respectfully disagree. Dennis is the Cat. With a tiny company, market cap under $50Mil, a CEO salary of $1.14M [possibly rising still] makes no financial sense [with lack of revenue and expansion] and certaily no ethical sense for shareholders. It hard, if not impossible, to see it as something other than Dennis soaking all he can before BK and then riding off into the sunset with the HAL arb payout, leaving everyone else holding a painful bag.
Instead, Dennis should be taking a reasonable salary, proportional to the market cap, to demonstrate his loyalty to the shareholders and more importantly still, his belief and faith in the company. his actions, however, via this enormously disproportionate saary, speak to the tragic opposite.
Dcrete11, your respectful disagreement is welcome, but it's the stock price being decried. The Cat you describe gives no explanation of the stock price. I know of no company on all three boards that have a high priced stock because the holders like the CEO.
Eagle I always appreciate your posts, but I don't see how giving Dennis 3 to 4 times the salary needed to live a very good life is helping when that money could be put into the company for daily operations and expantion.
I agree if we were turning 100 million in revenue and growing the salary would be a non issue but I feel now it is. Not that it will change, but any other company would not be selling off assets just to have a good portion of the proceeds going to one individual.
I will stop at that, just something that bothers me, lets all hope for good news of more and new business in the next report next month.
Welcome back Eagle. As usual your views are sage and right on. SWN is one of the most heavily shorted stocks in the market. Today the WSJ said the drilling boom is leveling off according to Baker Hughes after a three year boom. Drilling rigs for NG have stabilized after plummeting due to low NG prices. Coal has been killed by the greens & the EPA, etc. Energy resources in the US are abundant and not being exploited. My point being that we're coming from a low base, a stabilizing base. Does ESPH have staying power ?? With the Fidelity money we bought months, possibly years. The business plan is sound but needs money and the interest of others to go ahead. With money being tight, risk money is not plentiful. We're getting in low I believe and with patience will be rewarded. However, it looks like M&A will end up being our savior. We don't have enough cash to wait it out. The HAL Arb could provide the needed capital. Strategic Partners have to be sniffing at our vulnerability after numerous awards have raised the visibility. ESPH is a plum to be picked. In a different world, at different times my greed would opt for going it alone. Not now.
Sentiment: Strong Buy
Badgertod2012 your market analysis is on the money. It is amazing except for today's market conditions that investment appetite hasn't overcome the industry lethargy. We could blame Obama, but that would be more of the blame game, which of course is simply a losers game. By now Bush doesn't seem to fit in this list. It isn't the technology. Just because I don't like officers making money solves nothing of any real issue. It's a difficult stockholder's choice to wait and see, "Will the real Mr. Ozonix Winner, please stand up. Remember the "To tell the Truth" TV show of the late 60s? The Blame Game list is long and goes around the planet. Europe, China, India, Russia and much of Africa and S. America. The Green people fight the wrong battles. The economies are in a slow recovery and the E & P Companies need help from no one. And you're certainly right, "It is a Plum worth picking."