" How do you find this stuff?"
Besides the usual googling, the greenie websites offer a great deal of information. I'm always looking fpr trends and events that upset them. And if someone is a greenie, they have plenty to be upset over. Some greenies classify themselves as NTE or Near-Term-Extinctionist. The battle is over. The planet has lost. Nature bats last.
For instance, thinkprogress is upset with the NYT for dropping their "green blog" and that the paper's climate change coverage has dropped significantly. Did you know that? I sure didn't until thinkprogress pointed it out that coverage has dropped by a third. On top of that thinkprogress is royally upset that the NYT is providing Bjorn Lombor space to say this:
"There’s a lot of hand-wringing about our warming planet, but billions of people face a more immediate problem: They are desperately poor, and many cook and heat their homes using open fires or leaky stoves that burn dirty fuels like wood, dung, crop waste and coal. About 3.5 million of them die prematurely each year as a result of breathing the polluted air inside their homes — about 200,000 more than the number who die prematurely each year from breathing polluted air outside….
"Even more people — an estimated three billion — still cook and heat their homes using open fires and leaky stoves."
The greenie websites are fountains of information. You just have to reverse-image their interpretation to realize that coal is on the comeback trail. Even the NY Times is starting to move on to other issues.
I just finished listening to the presentation.
I thought Skaugen did a great job explaining how Intel can still thrive in a market although it is late to that market. Reminds me of a tank video game where the player can choose a lightweight tank that moves fast but sacrifices armor and firepower or you can choose a heavy duty tank that moves slowly but once it has enjoined battle has advantages due to heavy armor and firepower.
December 5, 2013
"Ukraine has signed a long-expected deal to cooperate with China on constructing an energy plant to convert coal into synthetic natural gas, RIA Novosti said. The project will allow about 4 billion cubic meters of natural gas to be replaced annually with the synthetic coal-based product, Ukraine’s Energy Ministry said in a statement Thursday, December 5.
"The statement said the plant would provide a market for the production of 10 million tons of coal annually and create over 2,000 jobs. Ukraine’s state gas and oil company Naftogaz signed a $3.7 billion credit agreement last year with China’s state-owned Development Bank to finance the program."
"China’s National Chemical Engineering contractor and its subsidiary, Wuhuan Engineering, will provide Ukraine with the technology to build the plant. Synthetic gas production is a multibillion-dollar pollution-reduction project in China, which as of September had approved 18 of its own plants capable of producing 75 billion cubic meters of gas annually, according to the World Resources Institute.
"The idea has drawn criticism from environmentalists, however, who say the amount of greenhouse gases produced in the conversion process could accelerate climate change. Synthetic gas is a cheap energy alternative for Ukraine, which is desperately trying to cut its dependence on costly Russian natural gas."
My comment: Synthetic coal gas replaces natural gas. What a dilemma for environmentalists! By blocking the exporting of LNG from the U.S., they keep worldwide NG prices at very high levels which leads to switching to coal. On the other hand, if LNG exports from the U.S. are expanded, that puts pressure on U.S. NG prices and leads to coal switching domestically. Furthermore, the World Bank new policy of not funding coal projects is handing over power to China's Development Bank as the go-to partner for economic growth. Hey, it's cold outside. Brrrrrrrr.
I was surprised to hear the term "Tender Offer" mentioned as a possibility by Jeff Andreson in the latest presentation. The company making a tender offer for shares is the highest form of buyback. It indicates they want to buy a significant number of shares while the company is so cheap.
IVAC is sending a signal. They don't need to hold onto so much cash because they see cashflow coming in the near future.
I like the way this management team approaches business.
From The Milwaukee Journal, Oct. 20, 1959
The "Ask Andy" column
(Andy sends a complete, 15 volume set of Compton's "Pictured Encyclopedia" to Ginny Huddleston, 12, of Jacungie, Pa., for her question:)
"How Can a Tree Grow Out of a Rock?"
"We all know a tree needs to have its roots deep in the soil which gives it nourishment, so it is always a surprise to see a tree growing from the middle of a solid boulder. This is not a trick of the eye, but when we examine more closely we find that things are not quite as they seem to be. All trees need soil to nourish them and this little tree is no exception."
Am I exaggerating, or undergerating? I am at one with the Universal Mind. The vision is clear ...
Right now, Blonigan is sweating. He knows the company is underpriced and subject to a predatory buyout.
He is sending out flares to any and all shareholders, small or large, who will lend a helping hand to keep IVAC in control of its own destiny. The price needs to go higher so that IVAC will maintain independence until it reaches 2015 when the ExaFlood hits and Lean 200s start flying out the door.
I have a couple of posts that detail the value of photonics and these are particular relevant since IVAC once before sold their nightvision technology to Litton when it was analog. Let me give you the Big Picture regarding Photonics;.
Today, Photonics is in better situation to succeed than ever before with $31 million in 2013 revenues and growth of 20+% for 2014 and beyond, a backlog of $51 million, and most significantly --- THE WORLD's ONLY LOWLIGHT DIGITIAL SENSOR.
The real kicker is that the U.S. military is dedicating itself to nightvision as a crucial differentiator and strategic technology. The Army has adopted the slogan "We Own The Night". It's that commitment which pushes Photonics into a division worth AT LEAST $100 million.
Nightvision capability is the 21st century version of the stirrup which made the Mongols the invincible army of their time.
"Nevertheless, no one disputes that the stirrup as a weapon was a brutally effective harvester of souls that gave its wielders an unmatched technical advantage in battle for almost a millennium from 300 AD. The stirrup-less were engulfed in a seemingly unstoppable onslaught that left them facing a simple choice: adopt the stirrup or be exterminated."
Nightvision is no longer staring through a tube with 40 degrees of visibility at blurry green images, but single or multiple cameras that feed into a helmet with video stitching and create a 180 degree panorama with digital overlays (terminator vision) and images of much greater clarity.
This key military technology is based on Intevac's low-light digital sensor and NO ONE ELSE has it. It is a superweapon. The U.S. Military controls who IVAC can sell these sensors to, and most certainly controls who could be a potential acquirer of the division. If there were no such restrictions, and IVAC could sell their Photonics to the Chinese or the Russsians or the Iranians, then this division would sell for multiples of $100 million.
... the last thing I want is ---
"Intevac, Inc. (IVAC) announced today that its Board of Directors has authorized the repurchase of $30 million of the company's common stock. Effective immediately, the Repurchase Program will begin to be implemented in the current quarter."
You see, I want to buy shares at the cheapest possible price. With a buyback, the company will be blundering in and raising the price of the stock.
On the other hand, Blonigan is right to buy back stock. It is incredibly cheap considering that the Photonics Division all by itself is worth $100 million and the stock is only trading $45 million above the cash.
In my latest book, "Relax, It's Only the Apocalypse," I describe how all three of IVAC's division will be haymakers in the coming years.
The future will be filled with Virtual Memory Castles and Solar Powered Enclaves for the wealthy and marauders armed with night vision goggles. Perilous times, indeed.
If I had to pick one story that's depressing coal today, this would be it:
"The nation's largest public utility voted Thursday to close six coal-powered units in Alabama and replace two more in Kentucky with a new natural gas plant.
At the board meeting in Oxford, Miss., Tennessee Valley Authority CEO Bill Johnson said increasingly stringent environmental regulations and flat power demand have made it necessary to rethink how the utility generates electricity.
"This is a personal nightmare for me," said Peter Mahurin, a board member from Bowling Green, Ky., said of the decision. "But I must support what I believe to be in the best interest of TVA's customers."
In fiscal year 2013, coal accounted for 38 percent of TVA's portfolio while natural gas made up 8 percent. Johnson said he would like to see those numbers closer to 20 percent each over the next decade.
Senate Republican Leader Mitch McConnell met with Johnson last month to seek continued operation of all three coal-burning units at Paradise Fossil Plant in Drakesboro, Ky. The board had previously approved upgrading the two oldest units with environmental controls. But on Thursday, Chief Operating Officer Chip Pardee recommended building a gas plant there instead.
He said the third unit at Paradise is newer and has sufficient environmental controls to continue operating on coal.
The board also voted to close all five units at the Colbert plant in northwest Alabama and one of two remaining units that had not been marked for closure at the Widow's Creek plant in northeast Alabama.
Board member Joe Ritch, of Huntsville, Ala., echoed Mahurin's comments on the closures, saying, "As painful as it is, it's the right thing to do."
My Comment: To counter-balance what is going on in the northeast U.S., we have 4.9 billion people in Asia declaring coal to be the energy source of the future (and the present).
He said that saving a few jobs now would reduce TVA's competitiveness for years to come.
"Could be another RSH or JCP?"
Okay, I'll see your RSH and JCP, and raise to "Could be another Enron".
And if you re-raise me, I'm going all-in with "Could be another Hitler".
It's so damn cheap. AND I CAN PROVE IT and not with an apples-to-oranges comparison.
How you ask? How can I prove it? Because Intevac once sold their night vision business back in the 2nd quarter of 1995. They sold it to Litton industries for cash of $7,546,000.
Revenues had crashed for night vision: ""Net revenues of the night vision business included in discontinued operations were $4,221,000 and $18,356,000 for the years ended December 31, 1995 and 1994, respectively."
The revenues crashed because Intevac had not been awarded the next phase of a significant production contract from the Army.
Even under those conditions, photonics sold for almost double their revenues. What would the sale price be today with revenues of $31 million and a backlog of $51 million and the Army choosing Intevac to be one of three prime contractors on the Apache Helicopter? And our CFO stated that 2014 photonics revenues will be up 20% "plus a little more".
PHOTONICS IS A HUNDRED MILLION DOLLAR BUSINESS and we are trading about $50 million over cash.
It doesn't get any better if you want MARGIN of SAFETY.
Very interesting, Gsun.
A little bit of history I've gleaned from IVAC's SEC documents. Up until 2003, there were four companies that made disk sputtering equipment.
But in 2004, the bottom two couldn't make the leap to sputtering equipment capable of handling advanced perpendicular magnetic disks.
It is deadly when a company facing a revenue trough also has to invest tons of money in order to meet the demands of next generation equipment.
And from the Needham presentation, it sounds like IVAC is going after the service & repair market on Anelva's installed base. IVAC is developing a killer instinct.
... is that I don't want to encourage anyone to buy.
Before you buy, please realize ...
1) Flash is taking over.
2) Obama wants to end the military.
3) The sun sets every day.
4) IVAC sounds like a James Bond villain
5) They're losing money.
6) Their cash is worthless fiat paper.
7) California has high taxes.
8) Blonigan is a name that's easy to make fun of. For instance, "Blown-It-Again".
9) It's cyclical and you therefore always end up on the bottom.
10) I own it, so you don't need to.
Let's re-do this sentence:
"To be conservative, split the backlog up into year ($30m) and I can see that 2014 photonics revs will come in around $40 million."
Split the photonics backlog into two parts:
---- Less than a year backlog is $20 million
---- More than a year backlog is $30 million.
As a predictor, double the less-than-a-year backlog gives you $40 million in revs for 2014. Jeff Anderson is predicting 20% growth or about $36 - $37 million, but I think it will be bettered.
Current marketcap is $117 million.
Cash is $86 million.
No long term debt.
The Photonics Division alone is worth more than $31 million. They have the only low-light digital sensor in the world. A PRIME contractor on the Apache Helicopter and there are ONLY three prime contractors, Boeing and Lockheed being the other two. A $50 million backlog, and a good rule of thumb is that annual revenues will hit twice the backlog in three to four years. To be conservative, split the backlog up into year ($30m) and I can see that 2014 photonics revs will come in around $40 million. Jeff Anderson told us on a presentation to expect 20% growth in Photonics, but I think that will be beaten. Apache backlog will start to become revenue in 2nd half 2014. Add on top of this, the potential contracts with special forces (13,000 soldiers) ordering goggles and night vision helmets. $20,000 a pop. Don't forget LIVAR.
Compare Intevac's defense revenues with iRobot's and it will help you appreciate what a wonderful job is being done by Intevac and how desireable their products are. iRobot has top management, a long-standing relationship with the armed forces, and products which save lives. Bomb disposal, robotic reconnaisance (First Look) and more. iRobot's annual defense revenues have plummeted from $180 million to $50 million. That's how bad the budget crisis and shutdown and sequestration has been. Yet Intevac's Photonic revenues are holding steady at roughly $30/year with a burgeoning backlog which guarantees great growth in 2014.
If Photonics were spun off as a separate tracking stock (or be acquired) you would be looking at a value of 2 to 3 times revenues. That's right, $60 to 90 million.
The solar equipment business is FREE.
The media equipment business is FREE.
That is great news. I remember from the CC that inventory levels in PRB are lower than average too.