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Should You Invest Your Hard Earned Money in Nocopi Technologies (NNUP)?

·3 min read

Cedar Creek Partners LLC, an investment management firm, published its third-quarter 2021 investor letter – a copy of which can be downloaded here. A quarterly portfolio return of 0.5% was recorded by the fund for the third quarter of 2021, outperforming the NASDAQ Index, which delivered a -0.4% return for the same period. The fund also outperformed the S&P 500 (SPY) Index’s 0.6% return and the Russell Micro Cap’s -5.0%. You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.

Cedar Creek Partners, in its Q3 2021 investor letter, mentioned Nocopi Technologies, Inc. (NYSE: NNUP) and discussed its stance on the firm. Nocopi Technologies, Inc. is a West Conshohocken, Pennsylvania-based marketing technology company with an $11.4 million market capitalization. NNUP delivered a 17.24% return since the beginning of the year, while its 12-month returns are up by 17.24%. The stock closed at $0.17 per share on November 26, 2021.

Here is what Cedar Creek Partners has to say about Nocopi Technologies, Inc. in its Q3 2021 investor letter:

"Nocopi Technologies (NNUP) was profiled in our previous quarterly letter. We will repeat much of what we wrote. The fund owns 9% of Nocopi. The bid priced declined from $0.195 to $0.19 per share in the quarter. Nocopi markets specialty reactive inks in the educational and toy markets. Their Rub-it & Color technology can be used for coloring books, activity kits, play sheets, greeting cards, or any paper-based application. Nocopi’s largest customer appears to be Bendon under their Imagine Ink line of products. Nocopi is a very small company. It has four full-time and two part-time employees. In other words, it is almost a royalty company, although they do mix and sell their specialty ink.

Currently there are just over 67 million shares outstanding at a price of $0.19 per share, resulting in a market cap of $12.8 million. The company has no debt and cash of just over $1.7 million. Earnings are better than they appear due to revenue recognition rules. When they signed a four year contract, they booked all the guaranteed revenue in the quarter the deal was signed even though most of it would be paid over the life of the contract. The result is quarterly earnings are about $100,000 more than what is reported. Normalized annual cash flow is roughly $1 million and growing, except due to apparent cost pressures in 2020, and we think the number could be improved..." (Click here to see the full text)

Based on our calculations, Nocopi Technologies, Inc. (NYSE: NNUP) was not able to clinch a spot in our list of the 30 Most Popular Stocks Among Hedge Funds. Nocopi Technologies, Inc. (NYSE: NNUP) delivered a -25.44% return in the past 3 months.

Disclosure: None. This article is originally published at Insider Monkey.