Dyadic: A Stock to Avoid

Dyadic International hopes to use proprietary gene discovery to revolutionize cellulosic biofuel and pharmaceuticals. Investors should stay away.

Dyadic International (DYAI.PK) says they are applying their "proprietary enabling biotechnologies for multi-billion dollar markets in industrial enzymes, biofuels and biotherapeutics." A very exciting prospect, and just the sort of thing I've long warned investors to avoid. In short, they are a company with gigantic claims and not a lot of track record to back them up.

Why I Care (I don't, really)

In our survey of readers, one respondent asked that I write more about stocks to avoid. Dyadic added me to their press list a couple months ago, probably in response to my popular article on investing in advanced and cellulosic biofuels. If so, it's ironic. If anyone at Dyadic had read the article and thought about it a little, they would have known that I would not recommend anyone buy the stock, just based on their business plan, let alone the disturbing information I found in their press releases (see below.)

Recently, Dyadic sent me an email starting with the line "As you have shown a prior interest in Dyadic International..." (I did no such thing.) I decided to take a look at the company. Here is what I found:

Out of Date Filings, Possible Previous Securities Laws Violations

• The company has not filed an annual or quarterly report since 2006, at which time they were losing money. Lacking more recent information, we can only assume that the financial situation has worsened. Because of this, Dyadic does not even meet the minimal requirements to be on our stock list.
• The company has recently reached an agreement with the SEC in which they agreed to cease and desist from violating certain securities laws.
• They recently hired an auditor and they "plan" to begin filing financial reports on PinkSheets. This would be good news, to someone who believes those plans are credible.

Conclusion

At this point, I stopped looking. Why would anyone buy stock in a company that is not providing current information, and whose promises sound to good to be true? Given limited cash, why not invest it in a company that provides current information and promises to do something useful but believable? Here are 39 green companies which do just that.

DISCLOSURE: None.

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Comments

[A Barrel Full:]

....Dyadic added me to their press list a couple months ago, probably in response to my popular article on investing in advanced and cellulosic biofuels. .....

And they spam????

Oct 06 04:18 AM

[Tom Stark:]

If your superficial glance at Dyadic is your "looking into a company", I am concerned for investors that follow your advice. Even the most cursory look would have disclosed that their former
CEO and largest shareholder was removed from office by the Board for alleged embezzeling from an Asian subsidiary. Since then the ex CEO and the company have been locked in litigation that can only be described as a Mexican stand-off. Hence the inability to file financials that make sense. The stock has dwindled from $5 to as low as a $0.05 over the ensuing period and I have hung on because I believe in the enzyme they produce and it was very difficult to sell at any price for quite some time.
Could it be that they refused to scratch your back?
Tom Stark

Oct 06 05:05 PM

[Tom Konrad:]

Barrel-
Being a writer, I'm used to this sort of PR spam. I've received this same sort of stuff from good companies as well as bad. But I don't encourage it, and certainly don't think it's a good sign.


Tom S-
If you go to a used car lot, and see a car you'd be embarrassed to be seen driving, do you waste your time by taking it on a test drive just to find out if the brakes work and the engine is in good shape?

For me, Dyadic is just such a car. Sorry to hear you're still driving such a clunker, even though you have far more evidence than I that it's long past time to trade it in.

Oct 07 12:10 AM

[Rory:]

Do you wear stone washed jeans? Thank Dyadic for that. This enzyme has such far reaching potential, it's hilarious!!

Oct 12 07:20 PM