eFoodSafety finally got their annual 10K filing in late today, and everything is pretty darn ship shape on a go forward basis.
This financial statement is already nearly 3 1/2 months back, so it’s already kind of old news. When you read a 10k, you are looking for negatives the company might not disclose in a public forum. In short, I simply couldn’t really find any.
If you want to look at one minor negative- the number of shares I&O is climbing as the company uses stock to pay for a lot of stuff, raise capital, and reduce debt. As of July 9, there were about 164 million I&O.
On the plus side, the balance sheet is in absolutely great shape for a company in its development stage. They have no long term debt, and had about $1.1 million in cash at the end of April. Restricted shares were sold at $.25, which I believe is a very fair number for shareholders, to raise capital. Debt related to acquisitions was converted to shares at a number above the prevailing market- also more than fair to shareholders.
Revenues, primarily from sales of Cinnergen, climbed to $1.1 million for the year- double the previous year. This suggest a fairly robust Q4 as opposed to Q3 when they were just starting to sell Cinnergen.
All in all, for a development stage company with several commercial roll outs in the pipeline, they are positioned very well. Now, they just need to execute. PurEffect- here we come.
Here’s a look at the chart:
The stock has been going through a little consolidation phase, which I believe is a very bullish sign considering the drubbing the market has taken of late.
In short, this stock is poised to run up. I think it’s highly unlikely the stock will go down on the 10k- there really isn’t anything in it to spook investors.
I’ve included the 200 day moving average, which some avid followers of this stock tell me is the key swing point. A stock trading above its 200 day moving average is considered in a long term uptrend. The 200 day MA on EFSF is about $.31.
A little volume surge to the positive and off we go if they are right. Right or not, I believe this one could be setting up for a great second half of the year.
As usual, comments and questions are welcome.
Why do you suppose the company is not giving you any 411 on the immune bar? What’s the big secret?
Editor: I still don’t have any information on that item, but will be working on it.
Good Day
I have been e-mailing Redwood and CK41 Direct, Inc for info on revised release days for PurEffect(TM) anti-acne product infomercials, but received no reply. Also faxed Patricia at the main office several times with no reply. I fear that this is one of those times that no news is not good news. What are a your thoughts? Thank you for your time.
Sincerely,
Ralph
Editor: I have not received a reply to emails the last two weeks from my liason to the company. Therefore, I can’t comment on what’s happening. Could be either way.
Maybe you havent heard from them because they are hush hush because they are working on a deal with dupont for their OraPhyte product. If Dupont made a play for the Co what do you think the stock price would be worth. I would say alot more than $3.00 What do you think?
Editor: $3 times 150 million is nearly $1/2 billion. Better be a hell of an important product.
ps. Im not saying you think Dupont will buyout EFSF Im just asking what do you think the price would be if it did happen.
Editor: Absolutely no idea.
Whether it’s investing in this company or any other, it seems to me that investors are never happy. When there’s no news, they’re afriad something is wrong; when there’s good new, they’re afraid it won’t last. In your years of doing this journal, have you ever seen investors stay happy for more than a day or two?
Editor: Great observation. If you like the company and it’s products, this quiet phase is heaven sent for accumulating. If their silence is scaring you, sell the stock and move on. I don’t control these companies- just my content on them, and I can’t tell the future.
To Irv T: This is not the matter of fickle investors being difficult to please and make happy. This company is enormously frustrating. If you believe the hype, and note the products (and their magnitude) in their pipeline, one would think we’d be trading at 80 cents by now. Moreover, they consistently miss deadlines, issue vague press releases, and now we’re learning they’re not even communicating with the OTC guy here. I think investors have a right to be annoyed. This is not a game – there’s money invested here. Get real!
Editor: Thank you for your contribution. Valid points.
As an investor, does this company potentially have the greater upside than NIHK?
Editor: That’s like asking if I like apples or oranges better. I like them both, but not always at the same time. Right now, it seems like NIHK is today’s apple if that’s your favorite, but the market could be in the mood for an orange tomorrow.
look like the information has stop is bad news or are they sitting in something big
Editor: Could be either way. The company does have a lot going on, but clearly the pace is a big disappointment to the market.
Any word from the company to you yet via email/phone etc.?
Editor: Have started a dialogue. Things are moving along, but not as quickly as the market would like.
It’s not just the pace is a disappointment to the market – they are CONTINUING to miss deadlines. Any information about the Immune Bar launch? This was supposed to have happened by today.
Editor: I do have some preliminary information on that, and it’s very promising. Details to follow. Their poor performance is being reflected in the stock price.
What does “have started a dialogue” mean? What is the reason for their delay in contacting you? And how are things looking?
Editor: More info to come. I have a preliminary update on the status of most of the products, but will deliver my thoughts when it all becomes public information. I can tell you they are definitely behind. Everyone recognizes that. However, there are a few stars in the sky.
If you had extra money to invest, would you buy EFSF or NIHK at this moment?
Editor: Sorry for the delay in responding. I was separated from my computer by the San Diego fires. Tough call. Perhaps EFSF as NIHK has certainly been trading a bit better of late, and I like accumulating the ones no one wants.
When are we going to find some product in the stores which have said they will carry Cinnergen? I’velooked and enquired in thevarious drug stores and pharmacies without success. I have seen one TV commercial !! One !!!
Editor: Sorry for the delay in responding. I was separated from my computer by the San Diego fires. I believe many WalMarts carry the product. After a lengthy period of silence, the company is getting ready to start talking again. I’ll try to get an update for you on this issue.
Do you think we’ve hit the real bottom finally?
Editor: Sorry for the delay in responding. I was separated from my computer by the San Diego fires. Should be getting close.
come on a month with out any information what happen
Editor: Sorry for the delay in responding. I was separated from my computer by the San Diego fires. Is this a question?
Do you know when EFSF will report earnings?
Editor: Sorry for the delay in responding. I was separated from my computer by the San Diego fires. Next quarterly numbers would be mid December.
When can we expect your next write up?
Editor: Sorry for the delay in responding. I was separated from my computer by the San Diego fires. Should be in the next week or so. This company is getting ready to break its lengthy silence.
Has shooting finished for Pureffect?
Editor: Sorry for the delay in responding. I was separated from my computer by the San Diego fires. Not sure. I know they have shot a lot, but I don’t know if they are completely done.
Patricia Gruden stated that she planned for Cinnechol to be on shelves this past July. Why was that tie period missed? Is it close to hitting shelves?
Editor: Sorry for the delay in responding. I was separated from my computer by the San Diego fires. I can’t give you an update on Cinnechol as I don’t have that information right now. However, I can tell you the company is getting ready to break its long silence, and we should have some updates soon.
do u expect this company to be in the black (finally) for next Q #s? thanks in advance.
Editor: Sorry for the delay in responding. I was separated from my computer by the San Diego fires. The way the run the company, yes- I do expect them to get in the black sometime in 2008. However, I am not prepared to predict it will be next quarter.
this is starting to look like another plant
Editor: Sorry for the delay in responding. I was separated from my computer by the San Diego fires. Could be- it is the speculative end of the market, and you never know for sure.
In response to this: “This is starting to look like another plant.”
You said:
“Could be- it is the speculative end of the market, and you never know for sure.”
I’m a little confused why you wouldn’t be a little more dismissive of that notion. After all, it’s one of your covered companies. You’ve written about the potential of the company time and time again. Of course there are no guarantees, and you’re not responsible if the company’s a total scam, you just write about it and suggest good things that could be in the works….and etc. BUT, all that being said, I would think, given all the ink you’ve devoted to this company, you’d bristle a bit more ardently at the notion that the company’s a “plant” (whatever that means). Why not a more passionate defense?
Editor: Good question. Because I am not a blind, stupid, paid promoter who defends companies that haven’t delivered enough achievements to deserve a defense. I have a plan of action in my inbox that this company presented to me last January. It is a joke compared to what they have actually delivered. I will staunchly defend companies who deliver on promises. These guys have not. In fact, I believe they are remarkably financially healthy relative to the mediocre results they have generated. That having been said, some of their products are taking much longer to get to market than they said, but could still get to market in a big way. Therefore, I do believe the stock is a good “speculation” at this price as things might finally begin to pick up. If you want a cheerleader, go to a football game. If you want some honest feedback on speculative stocks, come here.
If you know the company is about to break its silence, how can you not know if the Pureffect shooting has been completed, or what’s going on with Cinnechol or the Immune bar? What is the company going to break their silence about???
Editor: They are going to start talking about the status of some of their products.
If I had budgeted for one more lot of shares to purchase – do you think right now is the time? Or do you think there’s a reasonable possibility of picking more up in the teens?
Editor: As simply a guess, now would be the time. It’s that time of the year.
One more question please: in your opinion, what is the company’s policy/view on issuing press releases/news on Fridays and Mondays? They never seem to do it – but wondering, with seemingly imminent news, if they might make an exception? Your opinion?
Editor: Actually, I like press releases post close on Friday’s. It gives everyone the weekend to read about it. The way the stock is trading right now, I would prefer to see them do it as you suggest.
Hi got a quick question on EFSF. I know there are many things that you can’t say, but the questions I have has to do with your opinion about how management has been performing. I know they pay you here(shares), so I know you have to be carefull…but, Do you think that the delays have been from mis-management or do you think some of the delays in just about every aspect of the company are from outside reasons that are qualified as just “business reasons” that are really out of everyones control? I have thought of PG as being very in control of what is going on. All of these apparent misses in the timelines seem strange to me. Your thoughts on this please.
Editor: I believe the delays can be primarily contributed to management being overly optimistic about how long it takes products to get adopted. Cinnergen is a great example. They thought the product would delivering about $25 million in annual sales right now. It’s not, but it is a fantastic product, and if it becomes viral in the diabetic community, could easily do so. Oraphyte- they thought it would be ready for commercialization, but they did the wrong kinds of studies, and had to go back to the drawing board. Cinnechol- took a little longer to formulate, but still looks great. 2008 could be the year. PurEffect- their partner is taking longer than anticipated. It tries the patience of shareholders, but they are slowly moving in the right direction.
2 part question here on EFSF. At what stage did EFSF not get the right testing done? DId the USDA not test properly? Did Dupont not hit the mark? How much time did this cost us? Is Dr. Joshi making sure everything is clicking now? Is this product still considered a full replacement for Meth Brom, and a front runner in this field? Thanks – Larry Bud
Editor: They are responding to what the multi nationals want, so in short- yes- they could have done the testing differently to accelerate the process. Dr Joshi it taking it in a better direction. It probably cost the company six months.
Mazol Tov the Immune bar has been launched. Well what do you think this will do for revenues and what do you think it will do for the stock price? This is the first time they have put out an after market pr. Do you think they have one coming in the morning to back this one up? I think we have finally hit the bottom in price time will tell what do you think is this the bottom or does it still need more time? One last thing you said they did the wrong test on Oraphyte who is they? The USDA, Dupont or EFSF can you please clear that up and when is the license and patent coming out for Oraphyte. thanks
Editor: EFSF should have done studies at the University level in conjunction with the USDA. They are doing it now. On the Immune bar front, we will see how the stock behaves tomorrow, and what the revenue stream will be. Too early to call. The stock might just have hit bottom.
The company announced the launch of the immune bar, but didn’t say anything about where it is available for purchase. Hopefully, they will release that info soon.
Editor: To follow- probably next week.
EFSF demonstrates that there can be an enormous gap between a good product and market success. One deficiency of EFSF may be their poor internet visibility. You only need to enter the keywords “Natural Diabetes Treatment” into Google and you will only find a bunch of competing cinnamon-based anti-diabeticals on the first page.
However, the real thing still is their OraPhyte project.
Ramon
Editor: Personally, I believe Pureffect could be the big story. Would like to see a media buy package to start believing.
What’s the theory behind issuing that Immune Bar release with NO URL or information how to get it? Sorry, but web marketing 101 says, “have your site up and running, then issue your press release so people know where to go get it.” Absurd. Does the company have some other theory that we’re missing?
Editor: Perhaps it is the first step in informing the investing public about what is going on.
approximately how long is your sense that the Oraphyte university studies should take? Are we talking another year? or another few weeks?
Editor: My sense is they will be done by the end of this year, but no guarantees.
Ballpark estimate on when the new Pureffect spokespeople should be announced? Nov? December? or not until the new year? thanks.
Editor: I wish I could answer that question, but it is in CK41s camp, and apparently EFSF has no control over that news flow.
I am hoping you can pass this message along to the company. Part of being truly successful is often in the details. Especially when you’re trying to launch new products, gain interest, and attract new investors. So, I’m really disturbed to see how careless this company is in regards to typos in their web pages.
1. Efoodsafety home page says:
“eFoodSafety.com, Inc. (EFSF: OB) is a leader in the research and development of nutraceutical products for a wide range markets. Our focus is on developing, licensing and co-marketing unique, best-of-breed products that address the health needs of consumers, worldwide.”
NEED and “of” before the word “markets”
NEED to remove the comma after “consumers”.
2. Cinnergen.com home page says:
“Cinnergen is a once a day liquid supplement, along with diet and exercise helps control blood sugar levels.”
NEED to add a “which” before the word “along” and then add a comma after “exercise”.
Ridiculous errors and very careless.
Editor: Will send your commentary onto the company. Good observations.
You should know – by that, I mean, the company should know – that many long-time, very loyal shareholders are dropping out and selling. I’ve been one of these long shareholders for quite some time now, but it’s getting more and more difficult to justify staying given the concerning mismanagement this company is guilty of. The university testing gaffe is really quite poor, as are the missed deadlines, mismanaged projections, under construction web sites (immune bar). This last press release was vague, directionless and essentially useless. And did nothing for the stock price. You suggested a possible re-test of .30? ha! We couldn’t even retest .26.
The loyal shareholders that you’ve written about — they are dwindling by the day. There is a point where, after one disappointment after another, shareholders are tired of it. We are at that point – finally.
Editor: Thank you for your contribution. That is my sense as well. However, there is one thing I have to say on the plus side. It’s a psychological thing. For long term shareholders, once the company completely frustrates you and you finally throw in the towel, that’s the exact point at which the stock turns around and runs up. It’s one of those unwritten rules of market investing. Here’s another thing I can say which people are kind of missing- the company is in remarkably good financial condition considering how poorly the sales have been going. Cash, no debt, rising sales, minimal losses. Not bad considering. It is not my mission to convince you to hang in there, but there are a couple of positives worth pointing out.
Still no update from the Company on anything?Do you have any idea when and if they will update us on the license deal with the USDA? Did they launch the Immune bar and why and when will the site be up?How can they launch the product if no one can buy it or find out about it?You had said they are looking for a marketing partner on Cinnechol how long before they will launch that product? Do feel it will be soon? Thanks
Editor: Apparently, you didn’t get this week’s newsletter. If you aren’t receiving it regularly, you should look at how to white list our publication in your email- information on the right hand menu bar at the home page. Here is a link:
http://www.otcjournal.com/archive/listserv/20071029-1.html
Read that.
I’m in this to long I have to wait it out. The products sound like they can’t miss they just can’t get it out to the public hopefully something will happan soon like immune bar web page up and running
Editor: I certainly hope so. Investors seem to be losing patience. However, sometimes it’s worth waiting for.
Is the sudden jump of the stock a much needed “good” sign? Is the market starting to turn?
Editor: I certainly hope so. Great news on the Immune Bar, and more to come. This could be the proverbial rabbit in the hat.
i went looking for cinnergenat the vitamin world and they said they hed it but stopped ’cause it wasn’t a good seller! i later found it at gnc and when asked he never knew they even had it . i bought some and will try it. I’ll let you know what I find.
so the one problem with efsf is lack of product marketing….no one has heard of it even in their own store! hope they promote it better in the future
al
Editor: I am told it is doing far better on the internet than it ever has in the stores. I wouldn’t be surprised if you got the same response in other retail places as well. Hence, the poor trading in the stock. Perhaps it has created an opportunity.
Nice to see Cinnergen on ABC TV did you see the piece. What did you think of it if you saw it? I think EFSF has finally started to get their S*&t together what do you think?Did you taste the immune bar yet? Do you think the Immune will be a success or a non event? What are your thoughts on the price of the stock can it go back to the .50 before the end of the year? Immune bar, Cinnergen, and Pureffect should be bringing revenues in the near term future would you agree to that? Thanks in advance.
Editor: Seems like it is possible the company is getting on track. I have tried the Immune Bar- just received six of them on Friday. Was going to write about it. I believe it is a fantastic product. Tastes great. $.50 before year’s end could be optimistic, but if there is a major breakthrough in either Oraphyte of PurEffect, it is possible. However, the market has to straighten up for it to happen.
I love this company and its products but is the stock ever going to make a move. no matter what news come out its just stay the same do you have any thoughts
Editor: If the company continues to deliver positive movement towards getting products to market, then yes, it will eventually trade better. However, the company needs to restore its credibility with its investor base, and apparently that will take some time. It also wouldn’t hurt if the market started behaving a little better.
I hope you werent joking when you said this. Is this all they got and what happend to the retail outlets joining on?”Big campaign planned for November, which is National Diabetes Month, and look for it to be added at many more retail locations with big chains.” Can you look into this and find out what is going on thanks.The month is 1/2 over and still nothing.What about Cinnechol is that ever coming to market?
Editor: I know what you know. I am not joking. If I joke, you’ll laugh. When allowed to, the company will make public disclosures concerning who is selling their products. When it happens, you will have the right to the same public info everyone has. In the meantime, if you are unhappy with the company’s progress, you can sell your stock if you own any. That’s how we all really vote as shareholders. Lots of investors are disappointed with the slow progress of the company, but it could change in pretty short order. I hoping it turns out that way.
I think its time to start selling this stick off I think the company is trying to get buy on smoke and mirrors you can”t get there products only buy phone they can’t get there web page up even I have one so maybe we all waited to long and I though they had some good things good poor management or somthing time to rethink
Editor: Thanks for the contribution. Everyone has their own view. I am willing to hang in a bit longer.
What’s a good entry level now?
Editor: Probably right here, or perhaps a penny or two lower. I believe that could end up being a heck of a good entry level when we have 20/20 hindsight. However, a drop below $.20 would probably be time to sell and give up for now.
What if the stock drops below $0.20 but I don’t need the money? Should I leave it in the stock or is it too risky?
Editor: That’s simple- you’ve just decided to become a long term investor- then you don’t really care where it goes- you only care what the company does, and assume if they make progress, it will eventually be reflected in the stock price.
Could you explain the short sqeeze at .32 from the press release today.
Editor: That news comes out of a service that claims to be able to track how many shares are shorted by market makers, and at what prices. The theory goes something like this- If the stock can attain the target price, which in this case is $.32. They believe there are 25 million shares shorted, which will have to be bought in if the stock trades above $.32, which should result in another price surge. First, the stock needs to go to $.32- we’ll see what happens from there.
I don’t know what buyins is but if this stock ever get to .32 I’m selling in all and I have a munch
Editor: I believe you meant a bunch. So do I. The theory is that if it can close above $.32, it will go much higher as shorts are forced to cover. News this AM which could be prolific. Let’s see what happens. It’s got to close at $.32 or higher for it to happen. I’d love to see what will happen at that level.
WOW is all I can say if anyone sees this the stock will take off. This is very good news.Could you imagine what this would mean for EFSF and its tested safe Citroxin? I would say a big Pharma Co. would love to own the next super product in their portfolo of drugs. Once the word gets out this stock will fly.What do you think it is worth if they can stop MRSA to the shares price of EFSF?This is BIG NEWS!!!!
Editor: I agree- someone needs to pick up on this. Very good stuff.
I thought you can’t short a penny stock! I can’t do it through my e*trade or tdamer accounts. How are the short holders getting in a position like this? (I would have loved to short CPNE!)
Editor: It is possible to short low priced stocks if you can get a legitimate borrow. The rules that prevent individual retail investors from doing so are related to brokerage firms, not regulators. Also, market makers can legally go naked short. Huge fund managers with millions of dollars with prime broker relationships can pull it off sometimes. There are a few firms that will let you short stocks at $3 or more.
Correct me if I’m wrong, but in regards to that “short squeeze” press release – from what I have observed, seldom does that have any real driving impact to the stock. First, the stock needs to REACH .32 for it to matter. Secondly, now that news is trickling out, why wouldn’t shorts slowly (and in a more controlled fashion) begin to simply lessen (or liquidate) their positions? It seems to me, the only way this situation would have any real impact would be via a blockbuster press release that is unexpected, catches shorts off guard, and that drives the stock past the .32 point. But as a long time share holder, I would not place the odds on this to be very good.
Editor: You will note I never really commented on the “short squeeze” possibilities. I have seen it work on occasion, but it’s not worth betting on. For my money, start selling your products, and your stock goes up. That’s what matters.