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Green Earth Technologies, Inc. Message Board

  • know_Genius know_Genius Sep 10, 2008 9:26 PM Flag

    My view: Smart (maybe) Fast (definitely not)

    After looking through some of the posts I have to make a few comments. I don't post often I think my last post was several years ago.

    I will state up front that I own a lot of this stock but I bought it a lot lot lower. If I was smart money I would sell it. Why?

    1) because of the lack of financial statements. I believe the outstanding is roughly 35 million shares.
    2) I don't remember who said financial statements don't matter but they are absolutely dead wrong. They don't only matter they are everything and any smart investor knows this.
    3) They will almost certainly raise more money which will dilute us.

    Why if I think smart money would sell why haven't I sold if I think it is so smart? Great question!!!

    1) Long term gains. I tend to invest in early stage companies I generally invest 100k at a clip. I make about 10 bets a year and I on average I hold 3-5 years. My cost basis is around .25 cents give or take a penny or two.
    2)I think I have a good handle on the capital structure here. and like I said I believe there are 35 million shares give or take 5-8 million.
    3) The current enterprise value using those numbers is a whopping using $2 is about 70 million. It isn't cheap fundamentally and no value investor will touch it (especially given the lack of financial statements). Given that, for an early stage company growing rapidly and is in a mkt sector that is clearly cult like (pick any solar stock) it isn't absolutely silly either. I owned a few solar stocks and sold after I had a 10x return only to watch the sector go absolutely nuts and I could have had 100X. So I like to go slow and let companies like this mature. I was going to violate my long term rule and sell when it was at its recent highs 4.5+ but I didn't get my act together in time. If it got there tomorrow I would definitely sell given their current level of sales/profitability knowing that I can usually buy them back cheaper but I need to think I can buy it back down 50% or more in order for it to really be worth while after tax.
    4) They are always hard to buy back. Meaning that if a stock goes from .25 cents to 5 and you sell, I find it crazy hard to say ok, I am going to buy it here at 2.5 because you usually think it will go to $1. So you wind up getting frozen in the head lights and don't pull the trigger. figuring you can get it back cheaper and then you watch a small company that you really believed in in the first place start executing, publishing their numbers, announcing a constant stream of new contract wins and before long you are lamenting that you could have had a 100x and you punched out for 10x 20x.
    (more to follow)

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    • I was interested in PGOG, but saw that the stock price was WAY too high. It has come down considerably and I am considering purchasing some now, but I feel that their board members' records are a little shaky... so at this moment I'd feel more confident buying more GET than some PGOG.

    • Hi All, still long GETG and have been buying GETG all along. Please take a look at PGOG, company which makes bio-degradable plastic bags. I respect the opinions of the contributors on this board and would welcome your views on this company and it's product, which seems to have a good green thing upside. Or if you think it is flawed. And I did buy this company based on the fact that they are biodegradable and have a pending pharma-store launch coming.If you hate it, I want to hear it.
      Kind regards,
      ML

    • CERP has a big burn rate and isn't well funded. FYI

    • I will take a look. Saw they raised $2.6 mm. I see a lot of these PIPEs, but missed this one.

    • greeninvestor 42

      Thinking green, CERP is worth a look, nothing ventured, nothing gained!

    • Greeninvest,
      You are right. The share count about 90 mil on a Fully diluted basis which is a little more than double what I was thinking it was. I am working on the breakdown between c/s and Wts. There are a bunch of wts outstanding but I don't know the average strike price. I guess that is why I was looking to sell when it got to 5ish before but wiffed when it was there. It is a great speculative company but in this environment (I am talking about the major financial meltdown) GETG will probably be slow to have some major run. I would be amazed but I obviously would welcome it.

      I think it is best to sit on the sidelines in this mkt but I will just sit long for now. In a year or two, I still think this company will rock but in this environment nothing will. Even though I think it won't help the stock short term, the company definitely needs to publish financials because until they do no institutional holdings will develop. I'm long and I am going to stay long but I don't think we will make any significant sustainable gains near term.

    • I follow clean tech stocks and am invested in numerous private companies. I find investors have unrealistic expectations of the capital/resources it takes to grow a company that isn't a dot.com. I am watching Western Wind, Waterworld, Renegy, EPG, plus the solar stocks. Thin film seems to have a shot at grid parity.

    • Greeninvestor,
      The favorite stock I own currently is SNEN. I have owned it since just before they backed into their shell. Stock has performed poorly of late but I try to remind myself of my strategy. All my new investments lately have been in Chinese companies. 我喜欢中国公司但是很难。

      My biggest loser over the last 5 years was CXTI. I owned it prior to their reverse as well. Turned out to be a fraud and I absolutely didn't see it coming.

      Large Caps
      Long GLD
      Long SKF
      Biggest gains have been in Shorting large cap financials. I have been crushing it there but don't care to be specific since no one would believe it anyway. I have covered most of the individual names this week and have been increasing my short exposure via long position in SKF. For the record, started buying SKF at 121.85 a week or so ago and continue to add very slowly over the last week but my first purchase was too big and I quickly got smoked but small adds have helped reduce my average cost but I am still marginally under water. All in all I am up a lot net net.

    • I think you are full of it.

    • So basically, I tend to hold long term. Sometimes I watch my .25 cent stock go to $10 bucks and then back to 25 cents. Ugh! but usually I see them (assuming that I have done good Due diligence, met management, interviewed customers, etc) grow and in 5 years I wake up and have a very nice investment. I rarely pick the bottoms, I almost never get the tops but I usually make a return that beats almost all the hedge funds. I save a lot of time not following boards like these. I get to fish, play golf, and generally enjoy my days and I don't waste time listening to a bunch of guys telling me I am an idiot for owning it, or not owning it, or torturing myself because I could have sold it 10 cents higher and now have some dummy who is trading 500 share lots in my face laughing at me.

      I will tell you that I have met management. I like Marshall he is a very solid smart and energetic CEO. I like the sales team (forget their names) even better because they have developed brands very successfully in the past and have a very successful track record creating national brands. I believe they have the right team, the right management with the needed skill sets to do it again. I am critical of Marshall for the 1 billion in sales comment. I think he meant that it could do $1 billion in sales but they sure as hell won't do it in 2009!! No way no how! They don't have the balance sheet or the capacity to do it currently but more importantly they don't have the demand! I do believe that they could do $100 million however, and my model says the stock will be many times the current level if they do. If they did 100mil in sales with a 40% net margin (aggressive sales given current level, aggressive net margin but assume they could do it at that run rate) so estimate $40 mil profit put 8x PE (conservative and gives no value for expected continued growth). 320 mil enterprise value / 35 million shares gives me $9 stock price. 9/$2 = 450% return / 1 1/4 year additional hold gives me a 360% annualized return. That I will take.

      My revenue number is very very aggressive and I don't really think they could do 100 mil in sales by the end of '09 but I can definitely believe they could be on that run rate by the end of that year. If they are going to do that they will have to have a steady stream new national account wins which will result in a lot of big announcements etc. Hopefully If (big if) that happens maybe just maybe a bunch of crazies will start bidding the stock up to nose bleed levels like some of my solar stocks and I can hit an ever loving home run.

      Would I sell it at 5 today if it was bid. YES Would I sell it at 5 in 3 months if they tripled sales and controlled SG&A costs while they did it probably not but would sell it if it got to a level which I thought was multiples of what I think it is worth intrinsically (that is why I sold my solar exposure and why sometimes it is smarter just not to watch too closely!). I don't know much but I do make money (most of the time)....oh and do I really need to say that past performance is no guarantee of........

 
GETG
0.0790.000(+0.13%)Apr 24 9:55 AMEDT