Familar with TPCS only marginally from my investment in GTAT. The more I look, the more these things stick out at me:
- Finances look iffy at best
- Last two quarters had declining revenue
- Earnings did not meet analyst expectation past 3 quarters (partly analyst fault)
- TPCS seems to be involved in various sectors but no recurring customers???
The GTAT seems like a good order worth over $8 million I believe and it would seem there would be follow up orders.
But, somehow I am concerned about the finances here and the potential to perhaps do a secondary offering.
Having written this, if there were well known, this would probably be 50% higher and over $1.
What convinced y'all to invest here..................besides an outright gamble?????????
I have worked in machine tool industry- big and small machine shops. Metal fabricators are 75 cents a dozen. Always scrounging for business awarded at lowest bid. Sometimes they pay bribes to customer buyers to get orders. (Examples of companies I know accepting bribes in past: Ecolab and Ingersoll Rand's Schlage lock division.)
Very tough to make money. You invest in a new customer and they move the business to another fabricator to save a few cents.
I am only checking this out because Mark Gomes is promoting it.
I would not call this high tech stuff.
Although these are furnaces and not just metal fabricators, I get your point. And, I would have to think GTAT might be thinking this also as a way to save money knowing how many furnaces they need to meet the Apple contract.
And, that would also explain why they only gave a single, $8 million order to TPCS.
Very hard to figure but the typical business at TPCS is does not value the stock highly. It is only up due to Mark Gomes article and reputation. So, buying at $0.75 or higher is probably not wise. I guess I will just watch TPCS and look for an opportunity and try to better understand if TPCS is expanding in any way........other than the $8 million order from GTAT.
Some of my Speculative carry extra risk (and extra potential for outsized gains). I often call these "Ten Baggers Or Bust." Because of their potential to bust, picks like these represent the smallest part of my portfolio. They are a subset of my 10-20% allocation to speculative names. However, due to their potential to explode, I believe they serve an important role in a diversified portfolio.
Techprecision (OTCQB:TPCS) is my favorite example of this right now. The company is chasing several large opportunities:
Nuclear - Techprecision had been supplying components to the nuclear power industry for over 50 years. It remains one of the few U.S.-based precision manufacturers with nuclear component (N-Stamp) certification. We estimate that over 500 old casks need to be replaced with newer, safer casks. At a price of $1 million apiece, this appears to be a $500 million opportunity in its nascent stages.
Sapphire - Shares of GT Advanced Technologies (GTAT) have skyrocketed on the belief that sapphire is on the cusp of wide-scale commercial adoption, primarily in cell phones. TPCS provides sapphire production equipment (furnaces).
Naval - On April 10, the U.S. government provided approval for the purchase of 10 Virginia-class submarines. At one point, TPCS was doing just $300k of work per Virginia-Class sub. It has since grown that number to $7 million per sub. That's $14 million per year of revenue under the new work order, assuming their participation level holds firm.
All good reasons and wish I had bought before Gomes released this latest article. His last article on TPCS took it to around $0.72 and then it drifted down from there.
The items from the article are absolutely valid..............and iffy at the same time. But, I am here and was here as I see there might be something to this. But, read my initial post on this topic as those points are valid also (decling revenue, missing EPS expectations, etc.).
But, I do get the risk/reward ratio also.........and am here as I think there may be something to TPCS. My thoughts on Gomes 3 points are:
- Nuclear: What drives this replacement, the timing and then who are the competitors?
- Sapphire: Why the lower order from GTAT given the size of the plant from Apple? Could GTAT being designing their own furnace as that seems to be within their capability and would save much money as furnaces are a big part of all of their equipment. Could the order for smaller as GTAT may be finalizing their own furnaces?
Naval: Declining military complex although the recent budget did restore some money to the Dept of Defense. But, longer term, this is a declining industry. So, this is fine for now but not a reason to invest longer term.
So, I still have my doubts but also recognize that it these were better known, TPCS could already be a triple over $2/share. And, I will probably look to add a bit here if it drops to the mid $0.60's after this inital exurberance wains............as it did before.
I am on, they supply the furnaces for GTAT and like GTAT, they will be getting business not just from Apple but others as the price of Sapphire goes down and people look elsewhere besides Corning's gorilla glass. A dollar in a year would be nice but I am looking at 2 - 3 over the next several years. up 18% today. Tomorrow, who knows?
I have been watching for a while now. I finally bit w 10k @ 0.60. There is a risk here, but the bottom line for me is that the pain of losing 6k is less than the mental pain of missing a 10 bagger (or more) on something I am watching so closely
Additionally, it is a speculative pick of "Poised to Triple". Gomes seems to be a pretty good analyst, so that a bonus.