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Richard Moheban (aka Retired Aviator) earned a BBA in Finance, Investment & Banking from a national top ten (public) business school—the University of Wisconsin at Madison. He then went on to earn a BFA (with Honors) in 1992. After that, however, his one year of working in the corporate... More
My blog:
The runaway inflation theories are unsound.
My book:
Debunking the Hyperinflation of Peter Schiff and the Gold Bugs: A Guide for Investors
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  • Axion Power's Historical Market Cap

    This post is to show the difference between stock performance and market cap performance for Axion Power Int'l over time. While long term stockholders have gotten absolutely creamed beyond hope, and I make no excuses on Axion's behalf for that, the market has in fact not revised Axion's value down by quite the 99% that the shares have fallen.

    And the market is not exactly very bright when it comes to Axion. As I write this the shares' ask is $1.20 (OTCQB:AXPW) while the A warrants are bid in the market currently at $1.45 (AXPWW). Given that an A warrant is nothing more than the right to buy a share during the next 4 years for an astounding $17.50, the current fair value of an A warrant should be perhaps a penny or two. Yet here they are trading at around $1.50!

    Yes, markets can be at times insane or ignorant (your choice) and the market for Axion securities has certainly been that at times. Keep in mind that while share price is accurate in the below chart, market cap is only updated upon new SEC filings so at times it is not accurate in the chart. Some spikes merely represent a data 'catch up' of the system. Even as I write this market cap is not accurate at $3.4 million because shares out was just updated from 2.7 million to 3.4 million due to apparently the conversion of the remaining B warrants. (This was known to be coming.)

    AXPW data by YCharts

    AXPW Chart

    AXPW data by YCharts

    AXPW data by YCharts

    In the chart above you can see that if you bought a share at the worst possible time for $2100 (split adjusted), it fell to $1.27 today. Basically a total loss. But what would the share price be if Axion had not printed any new shares during this period, if theoretically it had operated at breakeven without needing any new share-issuing financing?

    Actually, we don't know. The market would surely have taken a different view of the company if it had steady sales sufficient to fund operations. But for the sake of argument, if the market had not taken a different view, but simply no new shares had been printed while pessism was just as bad, a share today would be worth, (drum roll) $2100 X 3.4/100 = $71.40. Quite a difference dilution makes. (Sorry JP but they weren't adding whiskey to beer, it was water.)

    Tags: AXPW
    Aug 15 12:10 AM | Link | 2 Comments
  • Axion Power Sales & Marketing Strategy (From S-1A Filed 10/6/2014)

    The following is taken from page 47 of the S-1A filed in conjunction with the public offering of shares/warrants in October 2014. Since sales activities are of such keen interest to Axionistas and subject to much speculation it behooves us to get our information straight from the proverbial horse's mouth.

    Our Sales and Marketing Strategy

    Over the last few years, our PbC technology evolved through the research, development, prototype and early adoption stages. On a parallel path, we explored potential existing as well as potential future market applications that our product might profitably service. Throughout the process, different PbC configurations, along with various ancillary components, were subject to trial and error testing. Our strategy was to find markets where our product demonstrated superior performance to the current products of choice; or where our product demonstrated a measurable cost savings alternative to those products; or where it provided a combination of the two. The end result of this process was the identification of specific target markets; the development of an improved PbC battery product that can be sold into those markets as a standalone unit; or as part of an entire Axion energy storage system such as our PowerCube; or as the battery component of someone else's energy storage system. The PowerCube includes not only PbC batteries but also all of the electronics necessary to accumulate or dispatch power from those batteries. The containerized Cube unit also includes battery racking, Axion's battery management system, all necessary wiring, a fire suppression system - in other words a complete plug and play system.

    During this same time frame, we have slowly built an internal six person sales and marketing team, that includes four people in sales, a program manager and a customer service rep, all of whom are focused on developing and commercializing various targeted market segments. Our main focus for this team has gravitated to the areas of transportation and Cube storage. In transportation we are working with railroads, such as Norfolk Southern, where we have been shipping product since 2012; stop/start vehicle manufacturers where we have been shipping prototypes since 2010; heavy duty truck conversion companies, such as ePower where we have been shipping product since 2012. In Cube storage, we have been working with contractors and integrators for small commercial systems (installed 18 kilowatt zero energy building storage system for the Washington Naval Yard in 2012) and small residential systems. We have also been working with developers on larger storage systems that incorporate solar power, such as BySolar Inc. with which we have installed our first of five (5) individual 500 kilowatt systems. We have also developed a model system that will service the frequency regulation market, similar to the way our onsite PowerCube has been performing in the PJM network since 2011. We are actively marketing this model with BySolar and others. And finally, the power utility area has experienced some recent growth partially in response to regulatory pressures. We have dedicated initial assets to this area and are in the early stages of building a new team of additional business development managers, research and development expertise, and system programmers, for the specific purpose of actively pursuing revenue growth with customers in those target areas.



    Historically, we have actively participated in related industry networking and trade groups. With the new story we have to tell, we plan to increase that activity on a prospective basis. With our new initiatives, we plan to develop leads from purchasing appropriate databases and potential new customer lists. For example, we subscribe to a solar installer database and uses that data base to directly market to various installers. We also plan to increase our attendance and participation in various regional and national trade shows.

    Of course sales cycle time varies greatly depending on the particular market and the specific customer's product knowledge and expectations, but generally speaking, excluding the transportation market, the time required to introduce our product to a new customer - through sale conclusion - is 4 to 6 months. We will partner with industry leaders in the various market segments to better penetrate targets that are suitable for our PbC systems. Most projects require some upfront expense to initiate the system development. This would be for battery production and software development to integrate the technology as a component in various component systems such as with the ongoing ePower project.

    Tags: AXPW
    Oct 10 1:54 AM | Link | 5 Comments
  • Axion Power Reverse Split Authorized Share Count

    Rather than add to the huge volume of APC comments the Reverse Split has generated in the mere 2 days since the RS filing, I'll do this instablog and link to it on APC. Those interested can post thoughts here without adding yet more to the Concentrators on this. I think the Reverse Split proposal is very important and I hope all shareholders consider all aspects carefully before casting their vote. I encourage everybody to contact Axion's Investor Relations ASAP if they find the terms objectionable so Axion can alter the proposal to be equitable prior to the vote.


    The filing asks us to vote in favor of a reverse split somewhere between 1 for 20 and 1 for 50 shares. We will have between 1/20th to 1/50th of our former share count. Yet the 350 million shares we previously 'authorized' will not be adjusted in kind, nor adjusted at all, per the filing. In effect, instead of a headway of increasing the outstanding shares by 350m/225m or 55% currently, under this proposal the Board would get a headway of as much 350m/4.5m or 7700% more stock they could issue without any stockholder approval. I find this 'pork' that was slipped into the 'bill', whether it ultimately turns out to be material or not, to be extremely offensive and thus worrisome for the audacity of it alone.


    We are given two arguments why we shouldn't worry:

    (1) The NASDAQ will protect us by ensuring we can vote on any share issuances.

    My answer: We are not on the NASDAQ yet nor is there any guarantee we will be on NASDAQ if the split proposal is approved, nor any guarantee that if we get a NASDAQ listing we won't be delisted at some future date. This protection could be completely hollow.

    (2) You can trust the Board not to be fast and loose with issuing the authorized shares.

    My answer: Then why did it matter that the NASDAQ is protecting us? If (2) is true then (1) is meaningless and unnecessary. So I guess (2) is not such a certainty after all.

    Further, any authoritative body that drafts a legal proposal to prorate all quantities equally and fairly is heading in the direction of earning my trust. Any such body that proposes things that are oddly unequal, unfair, and grossly distorting of the relative quantities prior to the proposal for no given reason is heading in the direction of warranting my distrust.


    This whole debate is ass backwards. We shareholders are made to feel as though something is wrong with us for questioning grossly distorting, unequitable terms. The Board should be on the spot, not us, for proposing such terms.

    Instead of the Board/CEO coming clean and asking shareholders for effectively what is a sky high authorization, it is not mentioned at all. Keen eyed shareholders have to spot it. In fact we are erroneously told "the net result leaves the shareholder exactly where they were before the split." Not true Mr. Granville.

    If they aren't going to issue astronomical share quantities, then they don't need astronomical authorizations. Just keep it the same ratio. Prorate everything!

    Analogical Musing

    To conclude my rant, I'll use an analogy. It's not perfect but close enough to show just how ridiculous this proposal is:

    Your neighbor comes to you and asks for a duplicate set of all your house keys. He says,

    "I've been a good and trusted neighbor for years, you know me well, and you know I would NEVER under ANY circumstance use the keys. And while you're at it, you might as well give me the keys to your garage and cars too. And let me again assure you that for no reason under heaven will I EVER use ANY of the keys."

    My answer: "Ok then. If you will never ever use the keys then you don't need a set."

    Disclosure: I am long AXPW.

    Tags: AXPW
    May 03 9:02 PM | Link | 40 Comments
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