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Thomas Almond
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I have been retired for over ten years. I did the online poker thing, but got tired of it after three million hands, so I have decided to take my poker bank and make a serious stab at playing with stocks. I have been in and out of the market for 15 years, but this is the first time I have ever... More
  • GEVO: Rocket To The Moon (Part 3)  5 comments
    Mar 5, 2013 10:04 AM | about stocks: GEVO

    Lest I forget let me clarify what I think is the biggest misunderstanding about GEVO

    Their biofuel product is of course isobutanol which is made from corn.

    Everyone should know that just about everything that is manufactured that we use in daily life needs some aspect of petroleum involved in its production. That includes everything from rubber (tires) to plastics. Hence the common term we always hear "petroleum products".

    What people do not understand is that in order to use oil, or petroleum to make all these products isobutanol must be extracted from the petroleum/oil.

    Gevo makes the Isobutanol without using any oil and most importantly makes it much cheaper than it costs to extract it from petroleum/oil.

    For GEVO to be successful it will never have to sell a drop of isobutanol to be used as a gasoline additive even though it can.

    There are many existing ethanol plants all over the country that are in danger of going out of business because they can't make any money manufacturing ethanol. These existing plants cost upwards of 200 million dollars to build.

    GEVO can partner with existing Ethanol Manufacturing facilities that are in danger of having to shut down by retrofitting them to produce isobutanol for roughly 40 million dollars.

    That is how they will expand fast.

    By entering in to partnership arrangements with their proprietary technology with the many existing companies with bio fuel facilities currently producing ethanol that are facing bankruptcy due to ethanol being unprofitable.

    Watch the video at this link to see how easy it is to extract isobutanol from GEVO's facilities and imagine how much more expensive and polluting it is to extract it from oil.

    http://gevo.com/about/our-business/our-science-and-technology/

    Perhaps that is the reason BP and DUPONT are so intent on trying to shut them down with these lawsuits. Think of the profits and business BP and DUPONT would lose by having a competitor who can produce isobutanol cheaper and without having to use any petroleum to do it. BP loses because its petroleum will not be needed to make everyday petroleum products and DUPONT loses because it no longer gets to extract and sell isobutanol from the petroleum it gets from BP. This last paragraph is just supposition on my part, but it makes sense.

    Disclosure: I am long GEVO.

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Comments (5)
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  • snosaint
    , contributor
    Comments (20) | Send Message
     
    I was led here from a Motley Fool article about GEVO and a subsequent search for info on S.A. I have been negative about ethanol as a gasoline additive since it's inception.
    It has been over 6mos since you wrote this. Has your perspective on this company changed in the last 6mos?
    28 Oct 2013, 03:28 AM Reply Like
  • Thomas Almond
    , contributor
    Comments (363) | Send Message
     
    Author’s reply » @ snosaint

     

    FYI Gevo does not produce ethanol.

     

    I would have not bought the stock if it had. :-)

     

    It is isobutanol.
    28 Oct 2013, 05:31 AM Reply Like
  • Thomas Almond
    , contributor
    Comments (363) | Send Message
     
    Author’s reply » @ snosaint

     

    I am right now in the process of writing a new article on Gevo that will hopefully be published. They are busting my balls on the editing, so it is taking me longer than I thought it would.

     

    I just bought some shares this past Thursday (10/24).

     

    I am bullish.

     

    So I guess the answer to your question is "YES" my opinion about Gevo has not changed.

     

    The short ratio is astronomical right now. November 5th is the comference call. I would not want to be holding a short position on November 5th. Would you?

     

    Luverne is up and running its first commercial production test.

     

    If we get positive news on the progress of production come Novemeber 5th I think a major pop will ensue.

     

    I think we may see the PPS recover fairly quickly from these levels in the run up to November 5th.

     

    Could be a nice swing trade even if you decide to sell before November 5th.

     

    Everything is a gamble, but that is my bet.

     

    This is the third time I have bought shares in Gevo. I am more of a swing trader than a serious LONG.
    28 Oct 2013, 03:46 AM Reply Like
  • Thomas Almond
    , contributor
    Comments (363) | Send Message
     
    Author’s reply » I got my GEVO article published.
    http://seekingalpha.co...
    29 Oct 2013, 02:10 PM Reply Like
  • snosaint
    , contributor
    Comments (20) | Send Message
     
    I read the articles and need to clarify my previous post: I never liked ethanol as a gasoline additive for a variety of reasons, and after reading the articles see isobutanol as a much better choice in that regard. I am glad to see more to whet my interest in this company.
    31 Oct 2013, 08:31 AM Reply Like
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