Add in the thousands of hospitals, hotels, stores, ect that still use R-22, and millions of homes. The EPA came out with their final ruling about a year ago and reduced R-22 being produced from 51 million lbs in 2014 down to 22 million lbs in 2015. In 2016 down again to 18 million lbs and 13 million in 2017. 9 mil in 2018 and 4 million in 2019. Shortages will begin showing up soon. By 2020 no new R-22 produced. The EPA is allowing recovered (recycled) R-22 use after 2020. Hudson is the largest company that recycles R-22. Low volume in Hudson stock shows the story is not known yet.
It looks like just a replacement for a shelf filing that is expiring In January 2016. I had to educate myself here on shelf filings so maybe someone else can help out. from what I read, a company can use a shelf filing to register securities so they can be used quickly or when market conditions improve. They can be prepared up to 3 years in advance so obviously Hudson has had this in place for quite some time. This new SEC filing is just to replace the old expiring one. The example that was given in my reading was for a housing company. If market conditions aren't favorable in the housing market at the present time but by using shelf registration, the firm can fulfill all registration related procedures beforehand and go to the market quickly when conditions become more favorable. I suppose like putting these shares "on the shelf" for now. Maybe Hudson, like some of us here, is looking ahead at a higher stock price and wants to be prepared to quickly take advantage. This batch of stock "on the shelf" has been there for maybe 3 years already and may never be sold. But they are prepared in case (possibly to buy another company for example). A shelf registration isn't allowed for all companies. They must meet certain conditions. I hope this helps. My feeling is that since they haven't used this shelf registration in 3 years, they don't need the money and are just renewing it to be used if conditions warrant .
Skiselev81 - Please show a source that most of the revenue "growth" came from an acquisition. The company states right on the news release on Nov 4th -
"The revenue increase in the quarter is PRIMARILY related to an increase in sales volumes for refrigerants and a higher selling price of certain refrigerants as well as contribution from the Company's recent acquisitions. Gross margin increased to 20% as compared to 10% in the 3rd qt of 2014."
Isn't this what a long term investor in Hudson wants to start seeing? Yeah, the coming 4th qt is a dud as always. They stated during the conference call only 10% of the yearly revenue comes in the 4th quarter.
Shortages will start showing up soon and the price will begin an accelerated increase. Maybe as early as next year when the EPA further limits production. You may see suppliers limit what the contractors can buy at some point so I would anticipate contractors trying to build their inventory. That will only speed up the coming shortage of virgin R-22.
Here's the EPA Ruling break down -
January 2014 - The EPA allowed 51 million lbs of R-22 to be produced .
January 2015 - The EPA allowed 22 million lbs of R-22 to be produced.
Beginning January 2016 - EPA will allow 18 million lbs
Beginning January 2017 - EPA will allow 13 million lbs
Beginning January 2018 - only 9 million
Beginning January 2019 - only 4 million
Beginning 2020 - NO NEW R-22 CAN BE PRODUCED (although recycled R-22 can still be used.)
My Conclusion - 1 - R-22 Prices will soon begin to skyrocket
2 - Recycled R-22 will soon become a huge business
Hudson Technology is the largest company in the US that recycles R-22 (and Hudson does 100% of Dupont's recycling).
As always, DO YOUR OWN RESEARCH and never buy a stock on a message board recommendation.