Those of you who read my review of EFSF’s last quarterly earnings release know I expressed some concern about the company’s balance sheet. In essence, their debt was about equal to the cash they had available for operations, and hence it appeared, at least on the surface, the company would suffer some cash constraints.
This morning EFSF put out a press release which alters the balance sheet landscape completely, and puts the company back on firm financial footing- they are perfectly positioned from a cash point of view to execute the Cinnergen roll out and move onto the other products they have in the pipeline.
The real eye opener here is the way they got rid of their debt. EFSF announced the debt holders converted their $1.5 million in both long and short term debt into restricted shares at $.55: WOW!!!!!!!!! – anotherwords- the debt holders just bought $1.5 million worth of stock for $.55.
With EFSF currently trading at about the $.40 threshold, this move represents a tremendous vote of confidence in the future of both the company and the stock price.
Here’s the chart in the early going:
The stock, which came down after last week’s surge above $.42 on the Cinnergen news, is surging again today on this news.
I would love to see it eclipse last week’s high, and set up a series of higher lows and higher highs. Whether it can or not, these kinds of high volume days act as a cleansing mechanism to take out the sellers and replace them with long term buyers- thereby setting up the stock for its next big move up.
The next big step would be to break the long term downtrend line. That would be huge.
Whether we make it above last week’s high or not, this thing is setting up for a big move. As I predicted, EFSF is starting to get noisy again, so look for more.
The debt holders just bought 2.7 milllion shares at $.55. How much do you want to own at $.40? What a vote of confidence.
Comments and questions are welcome.
Ok. That was awesome. Now, do you have any idea or thoughts on the number of shares outstanding? Or, am I getting ahead of what the priorities are and should be?
Thanks in advance.
Lewis (not the clown)
Editor: About 150 million.
from early this year TTGL charts look identical with efsf charts. both stock trying to beat the downward trend line…..should be be expecting a crash like TTGL did?
Editor: I never really try to get out in front of expectations- I simply set my SSL and sell if it gets there. When I use an SSL, I don’t sell the second it arrives. I hold for a day or two, watch the action, and watch how it got there. Sometimes I won’t sell if the pullback was on very low volume. Therefore, set your SSL- or mental stop loss- if it gets there, re evaluate. Sell if you feel you have lost as much as you are willing to lose and you don’t see an imminent turn around. It’s tricky, but it preserves the capital against huge losers. If you are long term, it doesn’t matter. That way you don’t have to expect- you just react.
I AM A DIABETIC, TYPE 2.
I OWN 10,000 SH OF EFSF
AT 0.29 CENTS A SHARE.
LAST NIGHT, I WENT TO WALMART AND
PURCHASED A BOTTLE OFF CINNERGEN
I WAS SURPRIZED. IT IS LIQUID. I TOOK
1 OZ AND IT TASTED GOOD.
MY BLOOD SUGAR LAST NIGHT WAS 166
THIS MORNING IT WAS 111
THE COST WAS$16.00 FOR A SIXTEEN OZ BOTTLE.
AT 1 OZ PER DAY, THAT $32.00 PER MONTH.
THE ‘E’FOOD STOCK SHOULD GO TO $1.00
BY THE END OF THE YEAR.
THIS MORNING IT WAS 111
Editor: So- we can assume you found the product valuable. Very exciting. Thanks for the contribution. Just FYI: You posted your comment in the Commerce Planet BLOG- it is on EFSF- please try to post your comments in the right company from now on. Thanks again.
They said RESTRICTED SHARES, what does that mean?
Editor: it means they aren’t eligible to be sold into the public market. They won’t be eligible for one year, and then still be subject to some restrictions.
Any idea when Cinnechol will be launched?
Editor: No- should be coming up pretty soon based on past press releases.
I have been hearing and reading a lot of rumors that EFSF is going to announce a reverse stock split in the upcoming weeks to get its share price over $1. If this might be true, how do you think that will effect investors owning this stock, and do you think we will be seeing $1 anytime soon?
Editor: I doubt that very much. I think a reverse split could be in the cards, but not at this time. If they start delivering north of $10 million in revs, I think it might be appropriate then so they could graduate out of the BB to a higher listing. Until then, I don’t believe they would do that. If they did it then, it would make sense.
I live in Blue Springs, MO. Las week I went to Wall Mart, CVC and WallGreens looking to purchase CINNERGEN. It was not available in any of those stores. I was surprised about that since the company touted that it was widely available.
Editor: I don’t know about CVC and Wallgreens, but I know it has distribution to some Walmarts, not all. You can simply get it online.
What do you think will be the catalsyt to get this stock moving up again and through the .50 wall?TIA
Editor: More evidence of expanding Cinnergen sales through other retailers and some expansion with the other product lines- for example, if they announced the production of the Pur Effect informercial and the stars, or got a deal with Dupont on Oraphyte, or starting aggressively marketing Cinnechol- it’s time for them to start moving forward on new fronts. The sooner the better as far as I am concerned. In the meantime, I love the way the stock is trading. Just hanging in there against a backdrop of nothing new going on. It will move when the time comes.
I continue to collect this stock and it is making me nervous but I said the same thing about CPNE and made a small fortune. I thought this company was fundamentally more sound. Am I wrong ?
Editor: Fundamentally, EFSF is not nearly as sound as CPNE. EFSF is more of a “story” stock- CPNE had real numbers. The idea is EFSF turns into a company with real numbers.
i feel as this stock is just waiting for the Dupont results and if they come back negative this stock is going back down to the .18′s or even lower..do you think this is the case?? i just think that this is to risky, its either pass or fail and i think thats super high risk investing maybe to risky for me :0
PS i love your site!
Editor: The Dupont deal for Oraphyte is not the only iron the company has in the fire for expansion. If they don’t get a deal with Dupont, I can’t say how it will effect the stock. If they don’t, but some of their other products have taken off, then we should be ok. If nothing else is happening by then, I am sure it would have a major negative effect on the stock. It’s really holding up well considerably how poorly many other micros are doing right now.
Sir – starting to wonder what the hold-up is on some sort of news from this company. Yes, they have many things going on, but based upon press releases and comments from Patricia, seems that some updates should have been issued by now. I.E. Who is the celebrity spokesperson(s) for the Acne product? What’s happening with Cinnergen #s / increased distribution? What’s the status of the Cinnechol launch? How about an update on Dupont’s testing?
Would you interpret this silence (and missed deadlines based up promises) as benign and /or even positive, or possibly alarming? One likes to see a company stick to their word and release news within their promised parameters…
Editor: Was kind of wondering that myself. Will forward your comment on to management. The company needs to keep things moving along.
If they do get a deal with Dupont what do you think it will mean to the stock price?I think it could at least double.
Editor: Oh- I think so- no problem. If Dupont does a deal with them to market Oraphyte, I believe the stock could double easily, and possibly become a $1 stock.
Lot of restlessness among the EFSF shareholder family. Lack of news is VERY disappointing here. People are starting to talk about bailing….
Editor: The stock feels a little heavy to me as well. On the plus side, I saw the Cinnergen commercial on CNN this past week. Really good stuff for 30 seconds.
I don’t know why shareholders would think of bailing from this stock at this point. Cinnergen is just beginning to make itself known in the marketplace, the jury is not in yet on DuPont, and there are other products in the pipeline. The pace may not be superfast, but unlike a lot of penny stocks, this one has a real product with more coming (with or without DuPont). IMHO, a little patience could pay off big on this one.
Editor: It’s summer and the company hasn’t had much to say of late. That’s about all I can tell you. Lot’s of good reasons to hold on to this one, but in the absence of developments I would expect the stock to drift down a little at a time.
Drifting down…down….down. Where’s the news? Time to hit the panic button? Time to dump?
Editor: That would be your call. In the absence of news, I would expect this one to continue to drift south a little. However, news could come tomorrow.
“I don’t know why shareholders would think of bailing from this stock at this point.”
You don’t? Well, for starters, we have a penny stock that has more in the pipeline than ever before, plus has recently retired all debt — yet, even with all that, it still cannot challenge even a MATCH of the 52 week high. (Let alone surpass it.) Furthermore, there has been an extended silence which can’t help but make shareholders nervous – why wouldn’t the PR machine crank up, to help a) keep everyone informed and b) to help keep the stock from drifting?
Bottom line – very few penny stocks go anywhere. Despite the projections, hopes, and earmarked product launches here, the investment community needs hard facts. There are virtually none now. The longer the silence, the more the drift down, the more shareholders will lose interest, lose confidence, and find better opportunities elsewhere. Going “long” on a penny stock is not the same as going long on a Nasdaq/NYSE stock. Historically, much riskier.
Editor: The extended silence is problematic, but they are out with some 411 on the Bird Flu product today. I’m not sure if it will put a charge in the stock, we will see. However, this is the speculative end of the market. You never know what is going happen. As soon as everyone gives up hope, the company turns around a delivers a series of positive developments on several fronts, and the stock takes off. You never know.
“You don’t? Well, for starters, we have a penny stock that has more in the pipeline than ever before, plus has recently retired all debt — yet, even with all that, it still cannot challenge even a MATCH of the 52 week high. (Let alone surpass it.)”
I listened to people who were much more experienced in the market than me when they said similar things about Force Protection about a year and a half ago. I was new to the stock market and bailed based largely on their feedback. I surely wish I hadn’t as it’s now averaging about $23 pps. What I took from that experience is that if you have a company that you believe has the right product and potential, then go with your hunch. I know this company is not popping PRs out left and right, but at least they’re not a pump and dump operation. We each have to make our own decision; if some want to bail that’s fine. I’ll be holding and accumulating for a while longer.
Editor: Good for you. If you want me to publish all kinds of glowing information when there is none, you won’t get it here. You know the products in the pipeline as well as I do. The most money is made by those who are willing to take the risk before these products are commercially available and successful. Much of making money in microcaps has to do with an instinctual feeling that things will work out well. If you instincts are good, you should do very well.
efsf has failed….they went from great to horrible
Editor: I don’t know about horrible. The stock is still up 50% since January- what’s wrong with that. They start delivering on some of the other products, and things could change.
Well, the stock broke decisively thru your SSL. Big move of 4.5 cernts/share. OUCH!! If there is news after the close, how about a weekend update.
One thing I’ve learned in Microcap speculation is that when it goes against you, beyond a SSL or your own mental ‘get out’ point, pull the trigger. Riding it down on hope is the sure road to ruin. You’ll have regrets, sometimes, but more often you’ll wipe your brow and say “Whew!! Sure glad I got out when I did.” That’s what I say about HESG. Should have said it about RDOC but held on hope while ISRG surged to $140/share from $15 post RS of 1:2.
So, set your ‘get out’ price and stick to it. No regrets about what you didn’t make. Or LOSE.
BD
Editor: I believe it is a matter of style. Some people like to be longer term, others like to use the SSLs. For the most part, I prefer the SSLs, but not as a rule. Just as a guideline- In some cases, I will hold them longer term, in others, I will sell at the SSL. We are already closing in on the time of year where it is better to buy than sell, so if you’re still holding them now, might as well hang in there. Most of the damage has been done.
The stock is plummeting and the worse, the company is in a prolonged silence. After displaying such great and consistent communication, it seems that any and all PR has been completely stopped. Is this as bad of a sign as it seems?
Editor: See my comments in the next BLOG entry on this one.