As of 4PM EST April 3rd 2017 shares of BTUUQ have been extinguished. New shares of BTU will begin trading tomorrow.
The catalyst for the price surge was policy based and has been snuffed out by Beijing. Moreover, met coal players face extinction; 47 of the 83 steel-producing countries rely solely on EAF mills, that number is rising. Even if prices continue to climb, emerging firms and current titans (Arch Coal (OTC:ARCH), SunCoke (NYSE:SXC), and RAMACO (Pending:METC)) will boast an unassailable cost advantage. The threat to Corsa (OTC:CRSXF) and all other currently listed (NYSEARCA:XME) entities is real and immediate. For a complete discussion on met, please refer to my previous article: The Short Case for Corsa Coal.
However, thermal coal is far more resilient. Whilst Chinese hydro generation grew by 18.5% from 2015-6, coal continues to generate 77% of its power. Furthermore, hydro's absolute delta constitutes 2.4% of overall production. Developing nations are ramping up coal generation; New Delhi plans to add 252 plants through 2024. Thermal has plenty of steam left - by 2040 coal (global) generation will increase by 18.6% to 10.2 TrKwH.
Introduction: Coal soared in 2016. Investing in an OTC listed or obscure coal firm with a skew to met seems like a no-brainer. Unfortunately, none of the sell-side analysts provided an answer to my decision rule. Do I really want coal to jump by $50 if it convinces management to spend $26m on reclaiming a high cost mine?
I believe that reports cannot answer the question because they fail to address the following:
• Problem: Most commodity markets are dominated by super-cycles that can last 16-30 years; it can take up to three decades for prices to reach the previous peak. Solution: I grabbed data since 1890.
• Problem: Peabody (BTUUQ) estimates that a $5 reduction in thermal prices will impact EBITDAR by ~51m; the annual standard deviation of thermal prices is $21. Therefore, a one SD move can wipe out 26% of the issuance value of the firm derived through a DCF. Solution: I aggregated mine level data to value the firm.
After addressing these deficiencies, I derived an EV of $4,351m for BTUUV. Stop! Don't think about the docket, don't think about current price, and definitely forget the court room drama. Even the most astute analysts are fixated on what should happen, they have ignored how to profit from what will happen. BTUUQ's shares will be extinguished, an investor can realize a 100% return by shorting Peabody, whether the current shareholders have been shanghaied or not. For the restructured firm, I have A target EV of $4,4bn.* Therefore, longing the new shares may net a 58% upside. This one time you get to double dip! Make no mistake though, these are not mutually exclusive trades.
The driver of met coal: Steel prices and cycles from 1797 to 2016
The first order of business is to get rid of investors' met fetish. Metallurgical coal's raison d'être is that it is a critical raw material in the manufacture of new steel. Analyzing steel gives one a better understanding of the economics driving met. The chart on the left zooms into the most recent peak to peak. The real price of steel took ~36 years to recover from its heights in the '70s. It is apparent that waiting out a super-cycle is not a dominant strategy. Additionally, a 50-year sample would barely cover a single cycle - I needed more data.
Fortunately, steel prices in the US are available from 1797 by major city. However, accurate data on inflation is difficult to find. Furthermore, both business and super-cycles obscure the evolution of real prices. The latter are easy to identify using band-pass filters, yet tedious to verify via economic research. Consequently, I used the 1890s as my starting point, which is in the goldilocks zone of data availability and my recall of American history.
I identified six super-cycles from 1890 to 2015. There were 33 business cycles over the same period. The most recent cycle and the one we currently occupy began in 2000 and peaked 11 years later.
From 1890 to 2016, the value add of steel has hardly budged
After I removed cyclicality and unearthed the secular trend, two things became clear:
1) The secular price trend hovers around the average price of $193 and it consistently leads yearly prices.
2) Any deviation from the long-term average is short-lived.
Implying that the value-add of steel has been constant since the 1890s. We use it to build things we live or work in (skyrises or apartments), commute in (carriages or cars), or kill with (guns or swords).
Cycles can be supply driven or demand driven. Those driven by the former exhibit longer periods of sustained price increases. For example, during the 1970s, steel prices scored their longest winning streak. When a sustained energy crises boosted price levels for longer than any demand-driven cycle. The length of the 1910s' cycle was a relative blip on the radar by comparison. I expect the trend to hold going forward; net steelmaking capacity fell in only six of the last 52 years. The industry has ample idle capacity to meet rising demand. The ITA estimates that global steel capacity stood at 2,364mt in 2015 whilst production totaled 1,620mt.
2016's price surge in context
2016's price pop was not an anomaly. I expected to find six inflection points, which would tally with the number of cycles - I found 28. Of the 28 events, nine were positive (preceded an upswing) and 68% were negative. Since 1897, the steel market notched four positive inflections (blue dots). The five remaining positive events are (green dots) "positive price pops". They made their last appearance 49 years ago, outside the scope of most analysis. Positive price pops are years when prices were higher than year before and after it. A sell-off following banner year provides support for neither party.
The market believes that 2016 was an inflection point - the least likely outcome. Unfortunately, the odds of the bulls cashing in are far lower than 14% (4/28). If the 2000s' cycle did end in 2015, then following would have to be true:
1. The 2000-15 cycle would tie the 1913-27 cycle as the shortest on record.*
2. Super-cycles are asymmetric and (save one) are skewed to contractions; the 1928-49 cycle took 14 years to peak and slumped for eight. 2000-15 would be the second in 119 years whose bull market outlasted its bear market.
3. The four-year contraction would be shortest on record, beating out the 1928-47 cycle by 50%.
Quite the achiever. The probability of a cycle claiming all three titles is equivalent to an event that occurs once in modern history or once every 403 years. Odds are that it was a negative price drop. The worst is yet to come.
EAF proliferation and the death of met
The proliferation of EAFs is an extinction level event (ELE) for met mines globally. The developments in the US steel industry in the 1970s are a microcosm of death spiral that will unravel globally. Whilst the Chinese are often blamed for the demise of traditional US steel manufacturers (BOFs) in the 1970s. It was American EAFs that knocked BOFs out of the market. The increase in net imports from 1970 to 2012 was marginal compared to the market share BOFs ceded to EAF mills. Similarly, while China is competitive against developed nations, other emerging economies such as Russia and Turkey are more so. However, they couldn't leverage their advantage due to capacity constraints. A deficit they intend to bridge (see piece on met for data).
The bulk of the capacity additions are EAF mills. EAF adoption has eliminated swathes of met mines' addressable market. Of the 83 steel-producing countries, 47's production base is comprised entirely of EAF mills. Of the remaining players, 16 are small timers whose combined production is dwarfed by China's. Whilst that still leaves the largest steel producers in play, save for the Ukraine and China they too have embraced EAF production. Turkey's and Italy's OBC production base stands at 35% and 25% respectively. Betting on met is a heads you lose the farm, tails you lose the ranch wager. Now that I (hopefully) closed the book on met, it is time to look a thermal. It turns out you can strike gold by investing in coal.
Thermal coal prices from 1797 to 2016
Full disclosure, the next two slides may induce some déjà vu. The chart on the left highlights the most recent peak to peak. The real price of coal has not recovered from its heights in the '70s. Once again, a 50-year sample would barely cover a single cycle - I needed more data.
Fortunately, thermal coal prices (like steel) in the US are available from 1797 by major city. Due to the aforementioned difficulties, I essentially discarded a century worth of data. This time I identified four super-cycles from 1890 to 2015 compared to six steel super-cycles and 33 business cycles. The most recent coal like began in 2000 like the steel cycle, but it peaked a year later in 2012.
Huge price swings dominate the thermal coal market
Whilst all commodities are defined by super-cycles, thermal coal lies on the longer end of the spectrum; a result of the perpetual supply abundance vs. demand.
I found that coal is subject to same natural laws as steel:
1) The long-term real price hovers around $61 per ton.
2) The secular trend leads (with varying times) yearly prices.
Once again cycles driven by the supply constraints tend to outlive their demand driven kin. I expect the trend to hold going forward; the current global reserve to production (R/P) ratio is 114 years. Nations such as Brazil and Venezuela boast R/P of 500+ years. Which leaves the other hangover from 2016.
Are Trump's claims just hot air?
I'm going to preempt allegation - I'm neither Democrat nor Republican. I hail from sunny Sri Lanka and I'm a card-carrying member of the UNP. If the Donald is going to trump market forces, he needs to overcome the laws of physics, at least according to the EIA. They attribute coal's decline to poor economics and unfavorable physics. Coal's heat rate is above 7,000Btu/kWh; generating electricity via coal is an endothermic reaction. Furthermore, coal plants are more expensive to operate than their competition. Consequently, coal will continue to cede market share to fossil fuels and renewables; coal has lost more ground to NGL than renewables. Trump will succeed in unchaining (deregulating) the animal spirits of industry, just don't be surprised if coal is channeling a sloth.
Pushing a string
Bear with me on this one, it is a doozey. Installed capacity of coal plants provides coal demand an element of stickiness that few products enjoy. For example, the EIA estimates that the Texas Reliability Entity's (TRE) price elasticity for coal is 8%. The TRE generates 22.5% of its electricity from coal and 77.3% from NGL. It can favor one energy source over another. So, why doesn't it? This is where things get truly interesting.
The Midwest Reliability Organization (MRO) generates 76.9% of its electricity from coal. The MRO is more dependent on coal than TRE. Unlike the TRE, which operates on its own grid, the MRO operates on an interconnected grid like most other NERCs. Consequently, it has more incentive and leeway to substitute coal generation.
The market balancing mechanism is ruled by the relative costs of fuels, which is measured by the cross-price elasticity of fuel demand. The devil is in the details. When coal prices increase, MRO shifts to NGL. Increasing demand, and therefore increasing prices for NGL, result in the opposite impact on coal markets. Therefore, on a net basis, it is cheaper for the TRE to increase coal generation in response to rising coal prices than the alternative.
The delicate balancing mechanism and the installed capacity of power plants mean the new administration faces a Sisyphean challenge. For example, from 2008 to 2009, the price of coal popped from $2.07/MMBtu to $2.21/MMBtu. Whilst natural gas nosedived from $9.01/MMBtu to $4.74/MMBtu. Increasing the relative cost of coal to gas a whopping 103%. Demand for coal fell by 16%. Imagine trying to attempt the reverse.
Let's pretend for a second that politicians are worried about reelection, don't balk. But in this highly unrealistic scenario, any attempt to pander to West Virginian voters (five electoral votes) alienates Florida (29 votes). Granted the transmission mechanism is complicated, the result is not. Faced with a constituency saddled by rising energy costs, a party may oppose their leader's agenda. SAD.
Fortunately, coal has a trump card in its hand.
Developing nations are power hungry, coal is serving up a spread that will make Golden Corral proud. Per BMI data, construction is underway in 64 countries on 642 coal fired power plants that will generate 85BMW of electricity. India will add 230 plants and the runners-up Vietnam will add 52.
The demand for power as nations develop is a secular trend. But why coal? A fuel that the EIA suggested is ill suited for power generation. Firstly, coal stations are not being raised en masse in advanced economies, rather they are retired. Consequently, the shift from coal is a factor of decay. The fact the G7 will add 21 plants through 2026 doesn't help matters.
Secondly, the shift to renewables is a protracted process. Recall that Chinese hydro production rose 18.65% yoy from 2015 to 2016, doubling capacity every four years. Yet, coal is still king in China.
Finally, the abundance of coal cannot be ignored. A cynical interpretation overlooks the depth of the problem. The reserves to production ratio of coal in many nations run into the hundreds of years. If these developments seem to clash with the EIA's narrative, do not be alarmed - they do.
Did the EIA fudge the numbers? Kind of…
Resource abundance is not an argument for adoption. The disconnect with the EIA's findings and the increase in coal capacity is on the back of regulation and the impact of NEMS (experience curve). They argued that given coal's tenure, coal plants wouldn't benefit from NEMS. It may seem plausible. However, America has used all major fossil fuels and hydro since 1895. The head-start that EIA was referring to versus NGL is 35 years. When you de-NEMS the cost calculations. Coal is on top.
However, the true cost of coal should include the environmental impact, which is staggering. The coal plants they used for their cost estimates included plants that were prohibited by law.
Fuels and technology are extremely sticky. Wood for example is making a comeback in the US.
Peabody firm overview
Peabody (PB) is the world's largest private coal producer. A title it claimed after filing for Chapter 11 protection. In 2015, the firm produced 19.6% of the US's total coal production. A true titan of the industry regardless of legal status.
The management hopes to reemerge from bankruptcy before or on the 30th of September 2017. PB used the reorganization to cull its workforce and reduce its operating costs. The firm has a metallurgical arm, yet unlike its peers, it hasn't caught met fever. Furthermore, per the business plan, it will not pursue expansion projects in the immediate future. Firms in bankruptcy are bound to the road map laid out in their business plan. Additionally, when a firm reemerges, its S-1 must also mirror the business plan. Consequently, whilst the financial statements debtors file are… well, let's say directional correct, their business plans are concrete.
Unfortunately, PB's current disclosure levels are wanting. Fortunately, I found information on all its American mines and power plant customers. The dataset provides a level of granularity that exceeds those of PB's previous SEC filings.
Legal proceedings and capital issuances
BLUF (Bottom Line Up-Front): Equity holders challenged PB's plan in court and lost. Analysts who empathize with the losers view the ruling as a miscarriage of justice and joust at windmills. Those who side with winners feel that their trust in the system was vindicated. The reactions are no different to any high-profile case, it is par for the course. I would caution against being swayed either party.
Many investors felt that the management violated its fiduciary duty to shareholders by low-balling the value of the firm. The resulting furor caused management to release an amended docket that included a valuation of the firm courtesy of Lazard Freres. Lazard placed the value of the firm between $4.225bn and $4.575bn. In the same ballpark as the secured debt of $4.3bn, but well below the total debt of $8.8bn. The valuation led to another backlash by equity holders. The charge was led by Mangrove Partners which owned 5.2% of the firm.
Yet, there should have been little doubt that the official valuation of the firm will straddle $4bn. If PB's value was well below that of the secured debt, the creditors can push for liquidation. Since the criteria for a "no equity in the property" has been met.
By doing so, the management did not violate its fiduciary duty to the current shareholders - it had none. In Chapter 11 proceedings, the creditors become the owners of the firm.
On the 26th of last February, bankruptcy court approved the firm's disclosure statements. The ruling allowed PB stay the course, essentially shutting down equity holders' claims to compensation. The court essentially rejected the alternative plan. Thesis revolved around the sensitivity of the official valuation. The plaintiffs failed to provide an alternative valuation methodology. Thus the judge correctly stuck with precedent - it's how the system works
Pursuant to the ruling on the 15th of February, PB completed the private placement of $1bn of debt instruments. The issuance comprised of $500m in secured notes with a coupon of 6% that matures in 2022. The other half of the placement comprised $500m in unsecured notes with a 6.375% coupon that matures in 2025.
The most recent update indicates that the secured lien holders will receive a full recovery through the combination of the private placement and follow-on offering. The payment will be paid in cash shortly before or after the firm emerges.
In total, the firm expects to pay out $3,041 to First Lien claims in all three of its business cases. Barring a catastrophe, the senior creditors will be made whole.
The follow-on offerings are the recovery mechanisms for the rest of the stakeholders with a claim of proof. Holders of claims of interest (equity holders) will be left by the wayside.
Under the firm's most bullish cash projections, PB will hold $891m in cash, ~28% of the firm's equity value, and 89% of its debt holdings (newly issued).
But there are some open questions about the firm's liquidity. Mainly the $1.14bn of (formerly) self-bonding and $320m in surety bonds earmarked for reclamation assistance. PB hopes to reduce the obligation by another $300m. PB's goal is conservative given the rate of deregulation that the new administration has enacted.
BTUUQ Trading on Fumes
On BTUUQ, dump or short the shares. They will be extinguished once the reorganization is approved. The expected share price is zero, a 100% discount to the current price. Stocks that trade on OTTCB or Pink Sheets with a ticker ending in "Q" are those of firms' that entered bankruptcy. The new ticker will end with "V." Unfortunately, investors are holding out hope for a 11th hour solution; the stock and its options on it are quite active. In fact, BTUUQ jumped 21% on Feb. 17th despite the recent court ruling closing the door on equity owners receiving any compensation.
"If the old common stock is traded on the OTCBB or on the Pink Sheets, it will have a five-letter ticker symbol that ends in "Q" ... old shares that were issued before the company filed for bankruptcy may be worthless if the company has emerged from bankruptcy and has issued new common stock" - The U.S. Securities and Exchange Commission
"Proposed $750 million common stock rights offering…As part of the plan of reorganization, the company anticipates emerging as a public company. As frequently occurs in Chapter 11 processes, the plan provides that current Peabody Energy equity securities will be cancelled and extinguished upon the effective date of a confirmed plan of reorganization by the bankruptcy court, and holders would not receive any value for such equity interests." - Peabody Energy
Peabody is dead. Long live Peabody.
Based on my industry analysis, investment thesis, and a trinomial cash flow derivation, I derived an enterprise value of $4,351m for the firm. Implying an equity value of $2,381m.
The firm will not deploy expansion capital until post 2021: That's a boon. However, PB can deploy maintenance capex. Thus, PB's capabilities will remain intact as the market processes the data on steam coal. With 6.3bn in reserves and 20% market share, it is well positioned to capture the 350-375GWs of power that will be added through 2021 globally.
• The vast majority of its contracts have or will expire from 2016 to 2019: Peabody reported that it inked down some of the best coal prices in years. 85% of its customers are supplied on a contract basis, 84% of whose contracts are expiring within the next three years.
• Australian segment provides a backdoor to Asia: Shipping rates to China and India from the U.S. Gulf are ~$19.15/t - around 5x the rate for an Indonesian firm, locking U.S. mines from the lucrative Asian market. For example, India and Vietnam will build 282 power plants by 2025, fortunately PB's Australian operations provide a backdoor to Asia.
• New management: Whilst the presiding CEO and CFO were at the helm when the company went under, at the time they had been in their positions for less than a year. Since they took over, they had halted growth capex, almost halved SG&A headcount, and reduced operating cost per ton from ~$62 to $42.
• Local political risk: If the Trump Administration overplays its hand and unleashes the fury of consumers and the NGL industry. The republican machinery will put party (its career) over allegiance (Mr. Trump's reelection) and throw its weight behind NGL.
• International political backlash: Ireland's sovereign wealth fund is on track to become the first sovereign fund to abandon coal. Climatechangenews.com reports that Eamon Ryan, the leader of Ireland's Green Party, cited Mr. Trump's administration as the impetus for the move.
• Peabody's returns exhibit negative convexity: It went to zero, but limited upside. The firm cannot sell more than the installed capacity of its customers. Furthermore, a NERC's ability to shift fuel sources dents the upside of continued price increases. Thus, its return profile resembles that of a bond and not a stock.
• You forget what I mentioned on the landing page: Stocks that trade on OTTCB or Pink Sheets whose ticker ends with "Q" are the shares of the company that entered bankruptcy. Those stocks are typically cancelled when the firm issues new shares and will trade with a ticker ending with "V". Not only has Peabody stated that current shareholders will not receive any recovery, but it has also stated that it will issue new public shares.
"As frequently occurs in Chapter 11 processes, the plan provides that current Peabody Energy equity securities will be cancelled and extinguished upon the effective date of a confirmed plan of reorganization by the bankruptcy court, and holders would not receive any value for such equity interests." - Peabody Energy December 22nd 2016
The sales price of fuel to a utility can be estimated by the known heat content and the cost per Btu (EIA data). The operative word being estimated since the calculation can get a little tricky; the heating value of a fuel can fall between a range of values.
The bubble chart plots the selling price (the size of the bubble), the heat content of coal, and the volume of coal delivered to each of PB's utility customers. The slope of the line is almost 45 degrees, implying a R2 of 0.9+. However, PB's top line is capped; the log of the same X and Y variables displays negativity convexity.
On a positive note, Peabody controls 63% of the power plant market in the U.S. 85% of whom are supplied on a contract basis, and 84% of those contracts are expiring within the next three years.
American mines are locked out of Asia
It costs more to ship coal, and the farther you ship coal, the more it costs. A "fine point" that is lost on the leadership at some mining firms (see my companion piece on met coal), who are intent on cornering over-supplied met regions in which they are the highest cost producer.
Currently, shipping rates to China and India from the Gulf are ~$19.15/t - around 5x the rate for an Indonesian firm. That's before the cost of $18.8 per ton in rail that PB must foot to ship the coal to a port. In the absence of a supply shortfall, the demand for US coal is zero.
An American firm's cost structure needs to be $33.92 lower than an Indonesian firm to achieve parity. Alternatively, the price of thermal must increase by 72% for an U.S. mine to supply Asian markets and break-even.
Fortunately for PB, its Australian operations (thermal) are well positioned to tap into the lucrative market. Pure-play American mines should sit out this round, absent a supply crunch.
Australian thermal and the backdoor to Asia
PB's Australian operations can cater to the Vietnamese market and profit from the Indian market. India and Vietnam will build 282 power plants by 2025. Although, India is expected to add more plants, Vietnam will be more lucrative to seaborne players; PB places Vietnam's R/P at 4x.
India will be a harder market to service. The Indian coal industry is cornered by Coal India Ltd. (OTC:CLNDY), a public entity. In aggregate the government controls 96% of India's production. Delhi aims to produce 1.5bn tons of coal in 2020, up 900m mt vs. 2015 levels. A target that even the political machinery believes is optimistic. Unfortunately, it is more common for nations to tout privatization as panacea for supply-demand imbalances than enact it.
Even if privatization gains steam, the hurdle for seaborne players is not getting to India. Rather it is getting through India. The sub-continent is in dire need of better infrastructure. Alas, progress on infrastructure is also painstakingly slow. The EIA estimated that a 93km of freight line that was scheduled to be completed in 2005 only reached the half-way point in 2015. The dominant strategy may well be to sit out of the Indian market and service smaller but reachable markets. Consequently, thermal revenues should climb despite flat volumes. Unlike its peers, PB has not caught met fever and paring its met footprint - a twofer.
Firm Valuation: DCF
Based on the DCF valuation, I derived an enterprise value of $4,686m for the firm. Implying an equity value of $2,717m.
The DCF model's assumptions are more conservative than the other. The DCF model foots with the bear cases in the lattice model. However, the DCF based EV is 8% higher than the lattice's. Since a DCF's FCFF must converge to a steady-state i.e. positive margins and above-zero growth. Even under the most conservative assumptions, a DCF model must turn a profit in the out years. Lattices are not subject to this constraint.
The next slides summarize the lattice valuation, it is ~50% less sensitive to top-line assumptions than a DCF.
Introduction to lattices
Any price move can be broken down to a single up or down move; you can reach all whole numbers by +/-1. In this case, I'm using the average value of an up move or a down move in met price. Moving from one price to another works like moving a pawn in chess, where each cell acts like a square and you can only move one square at a time.
① In 2017 the market price is 141. In 2018, the price can move up (cell to its right) or down (cell diagonally below).
② If prices increase it will be $169 = last year's price x average price increase = $141*1.2. In 2019 prices can move up to $203 or down to $136. It cannot move to $92; $169 would have to move down two cells to reach $92.
③ If prices fall in from 2017 to 2018, its value is $141 = last year's price x average price decrease = $141*0.81.
④ Our FCFF pawn moves in the same way. Moreover, all cells except for the outermost cells (in 2019 they are $71 and -$9) can be reached via multiple paths. A price of $19 in 2019 could be reached by either two up moves followed by a down move or a down move followed by two up moves. It is deceptively exhaustive, a lattice that covers 10 years and has 10 terminal price cells will contain 10 million outcomes.
⑤ To calculate enterprise value of NAPP, start at the last year. Then add the future FCFFs to the current year's value. All nodes in 2019 are terminal. Therefore future value = current FCFF. Now move to the previous year. It's a little trickier, if I summed the values of the two cells available to $83 ($71 and $20), I would overestimate the segment's value. They should be weighted by their probability. The probability of an up move is 59% and a down move is 41%. The values are based on historic data and a little tinkering.
$83 = current value = current FCFF + (FCFF if prices increase next year x probability of a price increase + FCFF if prices decrease next year x probability of a price decrease)/discount factor = $45+ ($71*0.59+$20*0.41)/1.3.
Firm Valuation: Lattice model
I derived an enterprise value of $4,351m for the firm. Implying an equity value of $2,381m.
The explicit model runs through 2035. These are a snapshot and the complete tables are in the appendix. The model can be designed to choose actions that maximize EV; it can choose to idle mines, reopen idled mines, expand its operations by investing in mines that are not operational. This is my favorite feature of this framework. It incorporates the impact of decisions made by a firm. In PB's case not expanding is a super dominant strategy - there was no scenario in which PB should expand.
Furthermore, the lattice's valuation is very robust. The equity holders' objections focused on the sensitivity of PB's value to the assumptions, but they failed to provide an alternative valuation methodology. Thus the judge, correctly, stuck with precedent - it's how the system works. Pick your battles.
Disclosure: I am/we are short BTUUQ.
I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
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