More news out of EFSF this am on their newest product discovery. Just to review: Last week, EFSF announced a major breakthrough with a new application for Citroxin- their mold fighting product. In a clinical environment they proved Citroxin kills the highly publicized MRSA Staph better than the antibiotics currently used to treat it.
Today, just as the market opened, EFSF disclosed it has formulated a transdermal method for getting Citroxin into the blood stream. Transdermal does not work for all medications- molecule size has a significant effect on the compounds ability to actually get into the blood stream through the skin and be effective.
There are some questions that need to be answered. What is this new product’s path is to the store shelves? Does it require some sort of regulatory approval to be marketed, and what would be required to make the claim that it can be used to either prevent or treat MRSA Staph? My guess: EFSF will disclose its plan for a path to the store shelves over the coming weeks.
I was a bit disappointed last week when the market did not respond favorably to the revelation that EFSF had a potential all natural therapy for MRSA Staph. It’s a huge health issue, and a media darling. However, it’s another arrow in EFSF’s product quiver that could end up generating millions in sales under the right set of circumstances.
I believe investors are sending a loud and clear message to EFSF’s management- time to stop talking about products- time to start selling products. I’m sure management is listening and putting its best foot forward, but the market only appears to be ready to reward results.
Here’s the chart, and there’s not much to talk about:
As you can see, after having a rough summer in ’07, the stock has been grinding in the $.23 to $.26 range. It needs some kind of major catalyst to getting it moving back up the charts once again.
While it’s true that the company is far behind where we hoped it would be in their sales cycle, there are some positives I believe the market is overlooking. The stock has remained relatively stable in price over the last month against a backdrop of the overall market blowing its brains out- there’s one positive.
Secondly, their extensive portfolio of very exciting products suggests it is inevitable they will have some sort of big commercial win at sometime in the future- probably about when investors finally lose patience and throw in the towel (we might be there now).
Thirdly, I don’t believe the company gets much credit for their darn good financial condition against a backdrop of disappointing top line revenues. Based on early ’07 forecasts, Cinnergen, Cinnechol, and PurEffect should have both been delivering millions in revenues by now. They aren’t. Cinnechol isn’t even commercially available yet, and PurEffect is in the hands of marketing company CK41.
However, despite the less than stellar top line numbers, EFSF is generating enough sales to have the required cash in the bank, no debt, and loses have been minimized to a virtual zero. In fact, I wouldn’t be surprised to see the company turn a profit in the current quarter.
In summary, I believe EFSF is a heck of a good speculation right now. While the sales haven’t come in as expected, the risk profile has been reduced considerably by the near break even performance last quarter.
After the drubbing the markets have taken in the last month, this stock is probably poised for a rebound of some quality in the not too distant future. This is a great level for accumulation.
Comments and questions are welcome.
It was my hope that EFSF would use Cinnergen to establish a marketing pipeline for their other offerings. Maybe this will happen but the fact that they are selling Cinnergen direct does not bode well in my view. In my industry, Industrial Supply, a manufacturer who sells direct is really nothing more than another competititor. This almost guarantees that said manufacturer will not receive much support and sales effort. Just my view but I think it is valid.
Donn Granros. EFSF shareholder for 4 years (or more)
Editor: I hope your extreme patience will be rewarded. Thanks for the contribution. You are making a good observation. Distribution is big.
I continue to stock up on this amazing company. I think it is a great buy at this price. I am surprised it has taken this kind of hit when they seem to be poised to make a huge jump.
Editor: It will probably rocket after everyone throws in the towel and gives up.
From your mouth to g-ds ears when will this stock be noticed. They have an amazing line of products. This is very big news for our health products. MRSA is a growing problem and people are dying from it. Lets get Citroxin on the fast track some where if it works as well as they say it does. How can we alert the media? Any Ideas how? Hey if I was infected by MRSA I would be bathing in Citroxin wouldnt you?
Editor: I’d try anything that didn’t make me worse. However, I think the market is simply saying to the company stop telling us about products, and tell us about product sales. Perhaps there is a catalyst out there no one understands yet. We just need a good break on this one.
I wouldn’t be bragging about the company being out of debt. They are only out of debt, due to giving away shares at their shareholders expense. They have devalued the share value of their own stock by dilution. I bet the other shareholders appreciate it too. Saying you have all these products doesn’t mean a thing. Selling these products is the only way this stock is going to be able to climb out of the hole its in.
Editor: I believe your comment is reflective of the view of many shareholders and interested parties. I don’t know that the company is in a hole of any sort- they have cash, no debt, and growing (albeit more slowly than predicted) sales. The stock is in a hole. If the stock traded better, you would view it as a decent company. We need some kind of catalyst to overcome the negative sentiment and get this thing moving. Clearly, product information is going to do it at this point.
Now I am confused.What did you mean by this statement…”Perhaps there is a catalyst out there no one understands yet…”Can you explain what you are talking about thanks
Editor: I don’t know why you find it confusing. All I’m saying is there could be some news event out there that gets the stock moving that no one can forsee.
one day I’ll wake up and this company will start sell some of there products and the stock will go up but until then I think everybody is right show me the money
Editor: A good capitalist.
well we had some good news with the maeket so i guess that not whats holding this stock down i think its a lot of talk and no action been in to long to sell
Editor: I guess most people are 1. complaining about lack of sales, and 2. Hanging in there anyways.
I am getting a bad feeling about EFSF. I own another stock, SPEX, that has had incredible products and is absolutely nowhere because their management had no clue how to sell it. Still don’t. They’re doing a “hail Mary” with their tagatose sugar molecule as a diabetes treatment. If it fails, they are done, for sure.
I’m suspicious that EFSF is long on products and very, very short on implementation savvy. This could continue to kill the company. Without sales, NOTHING else happens. Many, many good ideas have died because the creator could not sell.
BD
Editor: Much of successful microcap investing is a gut instinct about what might or might not happen. Sell it if your gut tells you its time to get out. I also believe being successful at microcap investing is also about selling your losers and moving on, even if the stock ends up working out.
Although I still own all my stock in this company, one thing is starting to bother me. They never follow up a big story with updates. One month ago they told us about their immune bar and the company that is going to market it for them. You would think something happened in a months time that they could let us know about. This could be another product that 6 months from now we are wondering what happened to it. They need to have someone who gives us regular updates on the progression of their products. Whether it’s good news or bad news. Me as an investor in a small growing company wants to know whats going on.I for one will hold on a little while longer, but if no information is givin in the near future might sell.
Editor: I agree- good observation. They need to get a much more cohesive information flow.
Do you think the company has a risk of NOT launching PurEffect? Do you think the company has a risk of NOT getting Oraphyte licensed? Thanks.
Editor: Absolutely. This is a risky stock, but as the numbers improve the profile gets a little less risky. However, anything that hasn’t happened certainly has a chance of not happening.
cpne and efsf are they run by the same people
Editor: No- they have absolutely nothing to do with each other.
Technically, do you feel we could close the “original” gap, .18-.21 without news? Best guess? thx.
Editor: I believe it is certainly possible, but I’m pretty sure most of the damage in the overall market has been done, so I believe the chances are diminished.
I am looking to buy EFSF should I wait for lower prices or do you think it has hit the bottom?It seems there is so much good news but still the stock acts like a dog.WHY?
Editor: I believe the stock is acting poorly because, at this point, investors only want to hear about increasing sales, not more products, to have renewed interest in the stock. If they show the numbers are going up, watch the stock go up. Plenty of irons in the fire- lets hope on really heats up.
1.Do you think the company has a chance of launching PurEffect and it doing millions in sales?2. Do you think the company has a chance of getting Oraphyte licensed and bringing in huge revenues to the Co.?3. Do you think the Co has a chance of merging with a partner?4.Do you think that Citroxin has a chance of becoming a blockbuster agent against the MRSA germ? thanks
Editor: 1 and 2- yes, there is a chance. 3 and 4- possible, but a ways off if ever. That’s the reason to speculate on this stock. If none happens, there are still other products that could carry the weight.
I tried to buy the immune bar today 12/4 and got a recording to leave a message is this company kidding? I,m beginning to think they have not sold one bar yet Do you have any answers thanks
Editor: They sent me some and they are wonderful in my view. I don’t believe they have really begun a sales cycle on this product yet, so I’m not surprised to hear they are calling back in individual orders. Most people are disappointed on the perceived lack of focus on actual sales vs product development. Your only real vote is whether or not to be a shareholder- your choice.
Well I did something good for the kids. I bought 500 bars and donated them to my sons school. He gave 50 bars to each of his friends and then handed them out to their friends. Well that was 3 days ago and already many kids want more. I told him to let them know about the website and where to order them. If EFSF cant do any advertising yet Ill do it myself. I happen to like the taste of the bar and since I started eating the bar I feel a little hop in my step. Its loaded with vitamins and minerals that make you feel good. I think they have finally released a product that will go mainstreet. It wont be long before we know if this product will bring in rewards to the shareholders. Do you know of what their plans are on advertising in the future? I have added to my stock position under .23 I think it will have a good move come January when this product gets rolling and Pureffect to. What are your feelings on Cinnergen sales are they going well? Have a Happy Holiday.
Editor: You have made some major inroads towards improving the nutritional profile at your son’s school. Perhaps the product will go mainstreet. I believe we will start to hear news about major distribution first thing next year. I applaud the extra step you took in trying the product, and make your own judgment on the potential for the product. Individual investors make fortunes by digging in that way. Have you eaten at a Spicy Pickle yet? Love to hear your feedback.
Citroxin from the product claims made, seems to be agood product but we do not know whether it is a natural product and the key ingrdients.
Editor: I don’t know the ingredients, but I do know it is an all natural product.