American Water Star hasn’t had much to say for a very long time. Since the late October conference call when Chairman Roger Mohlman boldly predicted the company was positioned to achieve the $80 to $100 million revenue mark in ’05, there has been little tangible news coming out of AMW.
They have announced several new distribution arrangements and a small acquisition, but there has been no disclosure of any kind concerning hard numbers.
The stock is not trading as if the company were achieving the predicted success. Year end numbers are due out very soon, and 1st quarter numbers should follow close behind.
Those who have been following my commentary know my view- I’m not really concerned about the last quarter of ’04. I’m relatively certain it will be better than q3, which was a disaster.
Q1 of ’05 is the benchmark quarter as far as I am concerned. If the company does not achieve at least $10 million in sales, the predicted $80 million in ’05 will be very much in question in my view.
AMW’s Roger Mohlman is conducting another conference call this coming Tuesday, March 29th, at 4:14 PM eastern, 1:15 Pacific. The dial in number is 800-977-8002, pin # 314935. For more information, here is a link to the press release:
http://biz.yahoo.com/bw/050322/225815_1.html
As you can see from this chart going back to AMW’s listing on the AMEX, this stock has not been a lot of fun to own. The institutional investors who financed the company at $.90 all bailed when the company fell on hard times last summer.
Tuesday’s call will be interesting. No doubt, it relates to year end numbers and hopefully some hard information concerning their current run rate. They have the infrastructure in place to deliver the sales, now we just have to find out if they are getting the job done.
If they aren’t, they have no one to blame but themselves. I am prepared to give them the benefit of the doubt and wait for the facts.
AMW has done an emormous amount of retooling, and is ready with a new distribution model. It will be interesting if they can couple HT and Geyser production to a distribution system, on 2005. As for this year, there will be some moderately high restructure costs, but this is probably factored into the price right now, and the current bump is a speculative one from indiependent investors, following a wave of insider buying by the directors.
Editor: I looked at the insider trades for 2005, and you are right. There has been some insider buying. Mohlman has been adding to his 35 million share position in a relatively small way, but nevertheless it is a bit of an endorsement. I just want to hear hard numbers, since I have no idea where the company is financially.
I can’t beleive that the stock reaction was down after that up beat conf call, but we all know the ceo was a crook in the past, maybe thats why, is name is tarnish and they should replace him. Whats your take on that conference call, could you tell us what do you think, thanks.
Editor: Special edition on that very issue coming- maybe today.
Regarding the conference call, the biggest information was Mohlman will be leaving AMW to run the bottling company spinoff. Whether this is good or bad remains to be seen. No real numbers regarding actual profit or loss was given out so it’s hard to say if the revenue increases he talked about are really beneficial. For those who want to follow on a daily basis go to the Yahoo Financial message board for AMW. You just have to sift thru the “bashers” & “pumpers” to get a reasonable sense of what’s going on. I look forward to OTC’s review of the conference call & hopefully you can have some real numbers regarding profit or loss. Thanks.
Editor: The edition has been published and I hope you found it a fair overview of the situation. If their infrastructure turns into profitable revenues, this one has a lot of upside. I don’t believe the market will buy into the rhetoric. I believe it wants proof at this time.
It has been three days since the “conference call” and the shares have gone from $.50 to $42, and seemingly settled in around $.44. So, now what? Can the RM data be trusted, and is he for real? Since we read what you write for your thoughts an recommendations, what do you think?
Editor: I don’t believe him, and I don’t not believe him. I am neutral, and patiently waiting for hard evidence. It is clear in the current market environment he is going to have to provide hard evidence to bring momentum back to the stock. Since he and others are buying in the open market, it is clear they believe.
I have a few question for you ? Did you know that mr Roger Mohlman was accused of 48 counts of frauds and was sentence to 72000$ fine, probation and community service, and also was called the ” granite man ” do you think it would be possible for the OTC journal to do a little more research before suggesting a company from such a crook, i bought a load of these shares but if I would of knowed this I would have not touch this company, to me his just a skeamer, it took me a minute to check this on Google, could you please do the same before you expose of any company you follow and thousands of investors buy those company, I know you’ve got compentation to cover these company and its absolutly normal, but why jeopardize your name with crooks like Mohlman.
Editor: I did do the research in this issue over one year ago. The facts of this are totally overblown, and happened many years ago. The 48 counts were 48 people who were ripped off from granite counter tops by his partner, and he personally paid them all back. It ended up being a minor infraction. If you don’t believe this, why don’t you ask the American Stock Exchange. The AMEX does extensive research before allowing a listing, and they are far better equipped than you or I.
This does not effect whether of not the company will become successful. The risks are still all the same.
I beleive your answers on the matter, and it make me feel some what better, thanks for the prompt and honest answer.
Editor: You are quite welcome.
I listened to his interview and it all sounded positive, but he mentioned people are hurting the stock price or as he put it being unkind. Is he talking about people that received stock for compensation of services and are now dumping the stock? And if that is the case, how much of that type of stock is out there? It seems like everytime I buy more stock at a lower price to lower my average, the stock goes down even further. I believe in the product and still think it has great potential. Thank you for your time.
Editor: I believe there has been a lot of selling in this stock simply because their numbers are terrible. There were high expectations for the WalMart relationship last summer, but WalMart basically dumped them. Then there was the Splenda problem. Now, I believe there is a chance for it to turn around, but the company needs to deliver hard numbers. My review of the conference call spells it all out for you very nicely.
Looking forward to your latest review of AMW. Keep watching for one since the last conference call but haven’t seen one. Thanks for your great comments!
Editor: I tried to give a fair appraisal of the situation, and I’m gratified you found it valuable. That’s what I’m trying to accomplish.
I don’t get it. The reason this company was worth looking at was the low carb drinks that were going to be sold at Walmart. You bought two cases yourself! The Walmart thing fell through for some reason – perhaps because the CEO is a crook? This stock is going absolutely nowhere and you know it.
Editor: The company’s problems have been well documented. Everyone knows WalMart fell through, and I don’t know who to blame it on. Perhaps the CEO is a crook, but he has sure put up a lot of his own money in the company. I don’t know the stock is going nowhere- maybe, maybe not. If the company generates the kind of revenues he is promising, it could do well. If the June quarterly numbers don’t provide huge results, I will agree with you and get out.
Does anyone know what is going on with AMW this morning. Does not appear to be trading. Thanks, for any info!!! Barbara
Editor: I also noticed it was halted for trading, but have no idea why. Could be good, or it might be bad. The year end audited 10K is overdue right now, so perhaps it is related.
FYI
Press Release Source: American Water Star Inc.
American Water Star Inc. Provides Update on Filing of Form 10-KSB for the Year Ended Dec. 31, 2004.
Tuesday April 19, 9:00 am ET
LAS VEGAS–(BUSINESS WIRE)–April 19, 2005–American Water Star Inc. (AMEX: AMW – News) today announced that, due to continued delays resulting from a recent change in auditor and additional work required to complete its financial statements, it has been unable to file its Annual Report on Form 10-KSB for the year ended Dec. 31, 2004. AMW is working diligently on a daily basis to file the 2004 10-KSB.
As a result of AMW’s inability to timely file its Form 10-KSB, as required by Sections 134 and 1101 of the American Stock Exchange (the “AMEX”) Company Guide (the “Company Guide”), American Water Star is no longer in compliance with the continued listing requirements of the AMEX. AMEX halted trading of AMW’s shares this morning due to its inability to file the 10-KSB. AMW is in discussions with the staff of AMEX to rectify this matter.
No wonder this company’s not going anywhere, they can’t even comply on time to file the 10k, look at the delay to provide orders to wall-mart, I am discusted with them, I will sell my position whenever there is a pop in price, if ever. what a scamer that Mohlman his, should be in jail as far as am concern.
Editor: I’m sure many share your viewpoint. I am just going to sit back and wait to see what happens.
amw, nwki, bptr, hypd, vtsi, fmly have suffered similar faits. It is becoming quite clear that your selected profiles are not a result of pure research, but a result of your conflict of interest in being paid for the research. My advise to anyone following the OTC, stop following the OTC. I have used VectorVest.com and it has paid off very nicely. It also keeps you out of the market during volatile downturns.. Best of Luck!
Editor: It’s easy to kick a guy when he’s down. I didn’t hear you complaining when VTSI went from the original recommended price of $.10 to $.44 in six month. I didn’t hear you complaining when HYPD went from $1.40 to $3.85. I didn’t hear you complaining when NWKI went from $.85 to $2, or $1.85 to $6 when I first featured it.
If you want to pick out stocks that are trading poorly, why not start with eBay- from $60 to $30 since the first of the year. There are dozens others that have suffered a similar fate.
I also noticed you didn’t mentioned I told all traders to get out of all stocks two weeks ago unless they were long term. 20 20 hindsight is perfect vision, and you seem to have great vision in the rear view mirror.
To The Board Inc: What is a “Fait”
Editor: It’s French- If I used the term “Fait Accompli”- it would mean it is a done deal or a foregone conclusion. I’m not sure where you are getting it, but I may have used the term.
After talking with the CEO a few days ago, I was left with a good feeling. That is assuming his comments are true. The stock is expected to start trading in a day or 2 from today and he has 40mil of his own invested. He feels the stock may take a temporary dip on opening and may provide good buying opportunities. The book value is about 4 times the stock price. The last month shipped more product than the last year. These are the positives. On the negative side, I tried reaching Don H for his input but was told he’s on sick leave and was referred to Redwood Consultants Jens Dalsgard. Jens never returned my call so I called back for Roger Molhman and did get a call back. My feeling was that no one wanted to talk until I connected with Roger. This changed my opinion to positive. I’m hanging in there and may purchase some more. I tend to be trusting of his word since he faces things straight up and appears to be a hard working CEO.
Editor: I’m not sure what is going to happen here, but there is always a lot more to any story than just the SEC filings. The action of being proactive and picking up the phone might just put some serious money in your pocket. In the microcap world, sometimes your gut feeling is the most important tool in making money. Thanks for some commentary on the positive side on this one.
I’ve performed consulting services for AMW in both the phoenix and JAX production facilities. His management teams are experienced, knowledgeable and solid. As good as they come. His plant layout and the equipment he has is top notch. Excellent engineering. This is an obvious indication that he’s truly committed to get things going. Why he’s not contract packaging as a stop gap until his brands take off is a mystery. He could be liberating a ton of cash through productivity. Lots and lots of bottlers need the spare production time he has and are willing to pay handsomely. If he’d only pay my past due I’d probably help him. Unused potential is unused potential.
Editor: It’s nice to hear some positive information from someone with first hand knowledge. For me, in order to really believe, I want to see the hard numbers.
After having audited the Phoenix and JAX facilities, it is obvious that AMW is dedicated to going forward. The management teams there are first class. As a former Coke and Pepsi bottler, I see a first class operation, a plant layout well thought out, equipment in very good condition and engineered quite well. What I don’t understand is why they’re not contract packaging as a stop gap until their brands take off. Co-packing would liberate a ton of cash, and utilize the non productive periods. This would spread his fixed expenses over more cases and reduce the cost per case on their own brands as well. Lots and lots of bottlers out there who need the production time he has available. Unused production time is a terrible thing to waste.
Editor: Thanks again for your contribution.
Having worked as a vendor that visited and delivered to the jax plant I can tell you first hand that they have not produced one pallet of anything–not even water–this is a scam– AMW owed my company money for more than 4 months before we finally recieved payment. We had to “cut off their acct permantently” there is only one person in the plant and he answers the phone–and will provide the 800# but answers no questions I invite anyone to go by and check this out the address is 6317 powers ave jax fl (904) 733-0555 behind the French Pantry everyone including myself that bought stock has been RIPPED OFF!!! and no I’m not a digruntled ex-vendor (shutting down the plant was a blessing in disguise). Beware I for one do not see this operation ever making money-the CEO likes to spend a lot of money on out of date USED equipment from another company that he owns–its a vicious circle where the only one getting rich is the CEO. If this stock ever trades again (doubtful) DUMP it
Editor: Helpful insight for those of us who are suffering with this never ending saga. I just hope those who don’t like the company have the opportunity to dump it someday, and those who like it can make the choice. Thank you for your contribution.
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