NigelM
Recovering Member
The problem with a volatile stock is that it tends to overreact both ways potentially leaving any commentator looking like an ass.
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The problem with a volatile stock is that it tends to overreact both ways potentially leaving any commentator looking like an ass.
NigelM
Recovering Member
smorgasbord
Active Member
Let's be clear: If it wasn't for Petersen, none of us would be talking about Axion. It just wouldn't be on anyone's radar. Petersen was a director at Axion, and claims to have sunk over $1 million into the company's stock back when it was trading about 5-10X what it's trading at now. Petersen found that attacking Tesla gave him a larger audience in which to push his own personal wealth building agenda, which is propping up Axion's stock. It has worked so far, probably saving Axion from folding completely.
From the company's own 10K and 2012 yearly conference call:
1) Axion's auditor's have put a "Going Concern" note on the 10K.
2) Axion is going to run out of money on April 30, 2013. That's less than a week away.
3) Product sales were under $10 million, and 81% of that comes from one customer. Similar numbers for the previous year, too.
4) Cash flow was a negative $8.6 million last year, and negative $11.4 million the previous year.
5) All of the questions on the Conference Call were posed by individual investors that are all on the SeekingAlpha blog. Institutions own less than 7% right now.
With a market cap of $28 million, losses each year that amount to more than 1/3 of that, and an EPS of -0.08, it's sure hard to think of Axion as "undervalued."
The entire premise of the company is a variant on the lead acid battery, that doesn't get as damaged as traditional lead acid or AGM batteries when discharged relatively deeply and then charged quickly (called Dynamic Charge Acceptance). If true, that's a reasonably good thing, but unfortunately, the cost has been too high. Petersen doesn't tell you that. Some math shows that Norfolk Southern purchased batteries from Axion at about $800/kWh, which is roughly double the price that Tesla sells its lithium batteries for at retail. Add in the enormous weight penalty, and its no wonder no company has yet committed to buying Axion's product despite years of looking into it.
The claim that these companies have long testing cycles just doesn't hold water. BMW, for instance, is coming out with new hybrid technologies every year under the marketing name "Efficient Dynamics." And, the claim that all previous institutional investors sold all their Axion stock due to reasons not related to the company's future success also doesn't hold water. Petersen publicly moaned about these investment companies selling at a loss because they had to, but it turns out that they sold for more than they could today - so they probably did the smart thing by not letting their money ride even further down. There's just excuse after excuse from Petersen on why Axion hasn't turned the corner.
Petersen has tried everything he can think of to prop up Axion and therefore his own personal portfolio. He has acknowledged in presentations at lead-acid battery conferences that lithium batteries are competition. He attacks Tesla and lithium batteries in general, often by stroking fears of safety or specious mineral resource constraints. He attacks plug-in cars, but not plug-in trains. The obvious reason is the plug-in cars are using lithium and one plug-in train company is looking at Axion's batteries.
No-one outside the company knows whether it'll complete its financing within 6 more days, or what the terms of that financing will be. No-one anywhere knows if any of the companies that have been testing for years and years will finally make a purchase, nor for how much. Buying Axion stock is literally gambling.
smorgasbord
Active Member
No protest from me on the moderators moves, but it's non-intuitive that anything in a thread that begins with "Nonsense" could be off topic. By definition, this thread contains people talking about nonsense.
While you're at it, mods, why not move this thread to the Off-Topic folder as well?
While you're at it, mods, why not move this thread to the Off-Topic folder as well?
FWIW, I'm happy with the mod's move as I'm not interested in this thread as much as the threads it spawns :wink:
For instance, I no longer click on any JP articles so as not to give him money. But I might put a buy order on APXW just so I can watch it more closely.
For instance, I no longer click on any JP articles so as not to give him money. But I might put a buy order on APXW just so I can watch it more closely.
(1) Supportable, sane, compelling arguments would be off topic for a "Nonsense" thread.
(2) Nonsense that distracts or influences the market is definitely on topic for "Investor Discussions".
The nonsense that is the subject of the thread is nonsense from JP about Tesla as an investment, so it's on-topic in this sub-forum. The AXPW items, though, weren't about TSLA. I debated with myself about moving the AXPW thread to the Battery forum, but I don't have mod rights there so it would have been more difficult.
jeff_adams
Member
ShortSlaver
Member
Classic troll bait sure to generate click revenue for him. So, hopefully he's covering some of his short position!
Jonathan Hewitt
Active Member
I refuse to click his articles anymore. Anyone accidently click it see anything worth rehashing here? Haha, I made a funny.
deonb
Active Member
Basically he says:
"When you eliminate the combined impact of the warrant liability reversal and the non-recurring ZEV credit sales, Tesla's Q1 net loss from recurring business activity will be about $30 million, as opposed to the anticipated GAAP net income of roughly $2 million."
He rants on and on about what essentially boils down to that $32 million. Isn't that like the profit from 350 cars, even at the current 10%? May have to have people work 3 extra shifts to make up for it...
And then in his comments:
"I expected the house of cards to collapse last year. At this point I'm not sure how long the charade can continue before people realize that the iron man is naked. "
"Tesla will report net income this quarter but it will not report operating profit. The gain from the derivative revaluation will be an extraordinary line item. If you're wanting to see two consecutive quarters of operating profit think 2014 at the earliest"
And then of course his true motivation in life comes out again: "The art of investing is to buy stocks when they're undervalued and sell them when they're overvalued. At this point Tesla has limited upside and unlimited downside while the reverse is true for AXPW. It's your money"
"When you eliminate the combined impact of the warrant liability reversal and the non-recurring ZEV credit sales, Tesla's Q1 net loss from recurring business activity will be about $30 million, as opposed to the anticipated GAAP net income of roughly $2 million."
He rants on and on about what essentially boils down to that $32 million. Isn't that like the profit from 350 cars, even at the current 10%? May have to have people work 3 extra shifts to make up for it...
And then in his comments:
"I expected the house of cards to collapse last year. At this point I'm not sure how long the charade can continue before people realize that the iron man is naked. "
"Tesla will report net income this quarter but it will not report operating profit. The gain from the derivative revaluation will be an extraordinary line item. If you're wanting to see two consecutive quarters of operating profit think 2014 at the earliest"
And then of course his true motivation in life comes out again: "The art of investing is to buy stocks when they're undervalued and sell them when they're overvalued. At this point Tesla has limited upside and unlimited downside while the reverse is true for AXPW. It's your money"
well, at .25/share, Axion certainly doesn't have a lot of downside left. but since it is down 50% in the last year and is completely married to the lead acid world, I'm not sure how much upside there really is. Also, didn't Petersen complain at one point about how bad for the world batteries were? Lead-acid has no problems on that score?
He lives in a fantasy world where all lead is recycled under pristine conditions, not shipped to third world countries, dumped on the ground, and broken up by hand.
To be fair, 98% of automotive lead batteries are recycled. But his "analysis" saying Lithium resources are limited is hilarious, because if you do the same thing for lead it turns out we're in much worse shape. The only reason lead supplies can keep up with demand is the high percentage of recycling.
Oh, and that 2% that doesn't get recycled is still a rather large amount of toxic material.
CyberDutchie
Active Member
He's getting slaughtered in the comments, definitely worth a read. It's been a while since he posted--and I doubt if he will ever post again. Good riddance. :wink:
Oh, by the way. EPS is more complicated right now than simply revenue, GM and expenses.
I know most of you guys have an allergy to Petersen's articles, but those who choose the red pill should go and read it (there is a chance of at least 95% that he is not payed for your click). Just strip out his comments and interpretations and take a hard look at the numbers. I almost feel responsible for the existence of this article, as I have privately asked him few days ago if he has any info about the total number of ZEV credits.
His info is not perfect, but the best I have seen to date - I would be grateful to anyone who finds more up to date or more precise knowledge.
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