Marine Exploration Stock Review, Thursday, 04/24/2014.
Los Angeles, CA 57…75F Cloudy.
Chicago, IL 48…62F Cloudy.
Delray Beach, FL 71…85 Sunny.
Port Jefferson, NY 42…60F Sunny. (195)
1. Adding Odyssey Marine (NASDAQ:OMEX) to Watch List $2.13.
To contact us send a email to: email@example.com
To Subscribe to the Marine Exploration Stock Review click here: www.marineexplorationstockreview.com/fre...
1. Adding Odyssey Marine (OMEX) to Watch List $2.13.
Okay, this is one of the best ideas we've ever stumbled across. Truly one of our best ideas ever. It has both excitement and danger. It's part technology play and part deep-sea treasure hunting play and part short-squeeze play - all rolled in one. And a $2.00 stock. The stars as they say, are aligned..
So pull a bar stool up to our tiki-bar and at look at what we found.
We have brilliant vicious short-selling hedge fund managers in one corner and brilliant nice-guy long hedge fund managers in the other corner. In fact one of the largest four largest asset managers in the world (GLG Partners) is long, as is BlackRock - which is THE largest asset manager in the world. Did we mention this a $2.00 stock?
We're so excited about it, we built an entire website around the industry and have spent an entire month researching the group. An Epic short battle between the forces of good over the forces of evil in the making - and we just bought a ring side ticket.
Marine Exploration Stock Review
In reality shorts aren't evil, we believe they just made a mistake. A huge mistake, in our opinion and the opinion of some of the brightest minds on Wall Street (backed by their money as they are shareholders and not just people commenting on message boards). This could very well turn out to be the "mother of all short squeezes."
Of course we could be wrong, despite our stellar track record. It's also appropriate for most portfolio's (widows and orphans excluded) meaning good for short-term traders and good for mid-term short "squeeze" traders and good for long-term investors. Since they're not a client (not yet) we'll even offer up dream targets.
Closing price $2.13. We bought in the open market at $2.00 on the 14th.
Short-term target $3.13
Mid-term short squeeze target $7.00
Long-term target $13
Real long-term target $40 (say what)
We have so much information we're not sure were to start - so we'll just offer up the most salient bullet points for now - including short and mid-term catalysts. We have a very long research report in the works - which will go into considerable detail - about the long-term potential and our wild real long-term target.
There are so many exciting facets - we don't even know what order they should go in, so we'll just wing it, excuse us if we sound like we're rambling.
Odyssey Marine (OMEX)
Shares Outstanding: 83 million
Market Cap: $180 million
5215 West Laurel Street
Tampa, FL 33607
United States - Map
Only one Wall Street analyst is following it, Mike Malouf with Craig-Hallum in Boston. He has a $7 price target. We've spoken, bright guy. We've also spoken to a number of the hedge funds, also bright guys. So a sense, nobody really knows about the company - and there appears to be no premium built into the stock price in anticipation of upcoming catalysts.
The company does have what appears to be a small band of loyal followers - and we are of the opinion if the name was simply better known on Wall Street, it would sell for a considerably higher price. Not an internet company valuation, but certainly not $2 per share - nor $180 million. Way too much potential - and as we said, excitement.
Odyssey is the world leader, the best and most successful "deep-water" exploration company out there. Unmatched track record. That's a fact. They found $500 million in treasure on the Nuestra Señora de las Mercedes in 2007, which sank off the coast of Portugal in 1804, when know one else could find it.
What this means, to state the obvious is:
#1. They had to first "know" a ship sank, somewhere off the coast of Portugal.
#2. They had to "know" there was a valuable bounty on the ship.
#3. They had to "find" a ship that sank 210 years ago, that no one else could find.
#4. The ship was 3,000 feet down (took them two years we heard, to find it).
#5. They had to send a remote operated vehicle (ROV) down, to get to the treasure.
#6. The ROV was operated with camera, on deck.
#7. The ROV had pick up the coins and bring them to the surface. While the ship rocked in heavy seas.
#8. The ship had to be able to carry 17 tons back to shore.
Sit back for a moment and contemplate, visualize # 1 - 8. They did what ? How ? What the ? 3,000 feet deep ? Yes this is a technology play. And they are benefitting from it. This is not the company it was 20 years ago. It is now technology driven.
End result. 574,553 silver coins and 212 gold coins. End, end result - Spain seized the bounty and the company learned a very hard and painful lesson - get the permits and cut a deal with whoever claims ownership - PRIOR to even looking for any other treasures!
Odyssey earlier (2003) found the SS Republic which sank in 1865 in a storm 100 miles off the coast of Georgia. The result of that expedition was a $75 million bounty of silver and gold coins. And more recently (2012) was they found the SS Gairsoppa, a British cargo steamship sunk by a German U-boat on February 17, 1941, approximately 300 miles southwest of Galway, Ireland. 4,700 feet deep.
On July 18, 2012, Odyssey announced the recovery of approximately 48 tons of silver (1.4 million ounces) from that site. Then in 2013, they recovered an additional 61 tons (1.8 million ounces) of silver from the shipwreck - this is the largest and heaviest recovery of precious metal from a shipwreck in history. Like we said, they are the world deep-sea leader with an unmatched track record (Mel Fisher by contrast would be considered a shallow water hunter).
For more information on the history of SS Gairsoppa click here
For an operational overview of the project click here
For answers to FAQ about the Gairsoppa click here
To see pictures of the Gairsoppa shipwreck site click here
Video can be viewed here:
Right now their ship just departed Port Charleston after fueling up to go 160 miles off the South Carolina coast, to take a second run at SS Central America.
The first run, twenty years ago where only 5% of the ship was excavated, brought up $50 million in gold coins. This would be called our "short-term" catalyst. Yes, exciting. It takes them about three months (barring a Hurricane, to excavate). Like we said, short-term catalyst and by looking at the stock chart, there doesn't appear to be a valuation bump as they set sail. So if they don't find anything, there shouldn't be a air-pocket drop - but you never know.
On the other hand, while some think there is nothing more aboard, some think there may be as much as $500 million. Time will tell. They are also experienced enough to quickly tell if the recovery would be uneconomical and cut bait and redeploy.
The SS Central America is one of the greatest shipwreck stories of all time and Odyssey was one of nine firms bidding for the contract. The ship was tied up in court for 20 years and the court receiver publicly stated, "We circulated a request for proposals to nine of the leading organizations in the deep-ocean exploration and recovery industry and established a rigorous proposal evaluation process. We found Odyssey's combination of experience, equipment and personnel are unmatched in their industry and we're now looking forward to their team completing the work that was started more than 25 years ago." Enough said.
The company stated "We're very familiar with mid-19th century paddlewheel shipwrecks, as well as the range of artifacts that are likely to be on the site. We have extensive experience with the tools and techniques required for this archaeological excavation, which will be very similar to the successful recovery of more than 51,000 coins and 14,000 artifacts from the SS Republic completed by Odyssey 10 years ago. We're also experienced in working at extreme depths. The SS Central America is less than half the 4,700 meter (15,000 feet) depth of the SS Gairsoppa, from which we successfully recovered 110 tons (220,000 pounds) of silver over the past two years."
Bob Evans, the chief scientist of the initial mission says he is thrilled to go back to the S.S. Central America after 23 years. "We are going to explore much more of the shipwreck this time, with much more modern equipment, he said. "We expect new, wonderful things to show up." www.newsweek.com/2014/03/28/sunken-ship-...
Bigger picture, UNESCO estimates 3 million (yes million) shipwrecks are out there. Odyssey has a database of years of wrecks identified to find (minimum $50 million per ship in their database). Others, we assume due to advances in ship wreck finding and recovery will bring competition. We'll introduce the competition as they come to surface.
If they are so lucky as to find anything North of $25 million, we believe this would be the first catalyst to ignite a potential short squeeze.
The real story (short and mid-term) is the fact that there are 20 million shares short. It didn't scare us away, but rather, it brought us to the situation. A short squeeze would bring us to our mid-term target of $7.00, six months to one year out. There are more catalyst, which we will be in our report.
High Short Interest list:
On October 31st a short wrote a scathing 66 page report tearing into all sorts of things. We read it and quite a bit of it was beyond our grasp. Prior to the issuance of the report there was a 15 million share short position and by year end, it increased to 20 million shares. By looking at the float, it appears they are running out of bullet - if they aren't already out.
Follow our math:
There are 83 million shares outstanding.
It trades 600,000 shares a day, so it would take about 25-30 days to cover (buy) 20 million shares. Just imagine if "any" fund tried to buy 20 million shares in the open market.
20 million shares represents 24% of the float.
It also represents 45% of the non-institutional held float, as institutions (which we believe are long-term holders) own 39 million shares.
For every dime the stock goes up, the short position loses $2 million. That's every dime. At $3.13 they are down $20 million. At $4.13 they are down $40 million. When do they say, as Roberto Duran once said, "No Mas" if the stock starts going up? Where indeed?
We're told borrowing cost can be 20% annually, so add that to the "patience" mix. (Source: Astec Analytics which states, equity borrowing costs have risen by 41 basis points since 2007 in the North American stock markets)
We checked the institutional ownership and since they didn't sell after the short-report was publicly released (and some added to the position) we'll assume they read the report and did not agree with the findings - though it did scare some of the retail (individual) shareholders. This is why we felt it wasn't essential to fully grasp the short story. It's short's opinion versus the opinion of the following shareholders. Who's right?
Here is the short report website called the OMEX Truth.
Here is a website called The Real OMEX Truth which has debating commentary from Green Asset Management.
And drum roll...here are some of the top institutional shareholders:
Brinker Capital (15 million shares).
This is their 12th largest holding and the rest their top holdings are ETF's and short ETF's, so we assume this is a contra-bear market holding.
Other holdings (amazing): relationalstocks.com/instshow.php?op=sum...
Black Rock Trust (2.9 million shares), largest asset manager in the world with $4.3 trillion AUM.
GLG Partners (2.5 million shares) 4th largest alternative asset manager in world with $30 billion AUM.
Black Rock Advisors (2.2 million shares)
Vanguard Group: (2.1 million shares) the world's largest mutual fund manager.
Clear Harbor (1.4 million shares)
Columbus Asset Management.
The holding is so new it's not yet in the Relational Stock database, so well just link to the SEC filing. They showed up on the most recent Proxy statement with 4,781,100 shares owned, currently valued $10,422,798. Oh boy. This is like the "Thrilla in Manilla."
We'll also note, since the filing was made as of January 29th, 2014 - that they had the opportunity to read the 66 page short report - and unlike us fully grasped the short sellers points and went ahead and bought $10 million dollars worth anyway!
We'll also speculate since the share price is near unchanged from where the short report came out and and that the short position went up 5 million shares in the two months following it - that Columbus may have been buying what the short sellers were selling. Our logic is since 5 million shares of selling didn't push it down and 5 million shares of buying didn't push it up - it was a push.
Okay, thats' all for now.
(This isn't the Shipwreck Exploration Stock Review, it's the Marine exploration because it is our opinion that many treasures which lie below the seas surface are the mining of minerals - not much different than mining for minerals on land. That's what's behind our real long-term target.)
Oh and one other crazy thing to note. Look at these four billionaires who just showed to the shareholder party. You can't make this stuff up. Google any of them. Ken Griffin $4.4 billion (Chicago), James Simons $12 billion (Port Jefferson), Paul Tudor Jones $3.7 billion (Greenwich) and David Shaw $3.5 billion (NYSEARCA:NYC).
Ranked by net worth:
James Simons (#3): www.forbes.com/pictures/eilm45fijj/3-jam.../
Ken Griffin (#8): www.forbes.com/pictures/eilm45fijj/8-ken.../
Paul Tudor Jones (#9): www.forbes.com/pictures/eilm45fijj/9-pau.../
David Shaw (#10): www.forbes.com/pictures/eilm45fijj/10-da.../
You can follow the Odyssey Explorer ship as it makes its way to SS Central America site at MarineTraffic.com
As for the long-term target, you can get a heads up on by studying Deep-Ocean Mineral explorations. Click here for that:
If you think mining underwater is crazy, look at the press release where LockHeed Martin (NYSE:LMT) states they think they can bring $67 billion to the UK National Economy over the next 30 years by mining undersea:
Disclaimer: The U.S. Securities and Exchange Commission (SEC) permits mining companies, in their filings with the SEC, to disclose only those mineral deposits that a company can economically and legally extract or produce. We use certain terms in this press release, such as "measured" "indicated," and "inferred" "resources," which the SEC guidelines strictly prohibit us from including in our filings with the SEC. "Inferred mineral resources" have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. U.S. investors are cautioned not to assume that part or all of the inferred mineral resource exists, or is economically or legally mineable, and urged to consider closely the disclosures in our Form 10-K which may be secured from us or from the SEC's website at www.sec.gov/edgar.shtml. Forward Looking Information
Odyssey Marine Exploration believes the information set forth in this Press Release may include "forward looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Act of 1934. Certain factors that could cause results to differ materially from those projected in the forward-looking statements are set forth in "Risk Factors" in Part I, Item 1A of the Company's Annual Report on Form 10-K for the year ended December 31, 2012, which was filed with the Securities and Exchange Commission on March 12, 2013. The financial and operating projections as well as estimates of mining assets are based solely on the assumptions developed by Odyssey that it believes are reasonable based upon information available to Odyssey as of the date of this release. All projections and estimates are subject to material uncertainties, and should not be viewed as a prediction or an assurance of actual future performance. The validity and accuracy of Odyssey's projections will depend upon unpredictable future events, many of which are beyond Odyssey's control and, accordingly, no assurance can be given that Odyssey's assumptions will prove true or that its projected results will be achieved. Not a client.
Additional Disclaimer: Important Distinction #1. First and foremost the Watch List is
just that. A watch list. It is not a buy list. Meaning that there will be
no buys or sales issued by the Reviews. If this was a buy
list, you can rest assured that we would crank up our Public Relations arm
into high gear, full speed ahead and damn the torpedoes to make everyone
know just how brilliant we were when we issued the list. Interviews on
CNBC, articles in Barron's and accolades in the Wall Street Journal--the
only thing we love more than money is praise and fame--but it just isn't
going to happen. What the Reviews are...is a "news
aggregation service". With the advent of the Internet, everyone knows what
that term means. What it means to us is the following: We will follow the
progress of as many Internet related publicly traded stocks as humanly
possible (The large, the small and the minuscule) and advise you of when
they have reported news. As a subscriber to the Reviews,
this means you will be able to broadly follow the entire industry right
from a single e-mail. We will report who released news and point (with
hyper links) to where the news can be found. We try to use Yahoo! Finance
as extensively as possible so we don't send you all over cyberspace. We
love Yahoo, you will too. Any decisions as to buy or sell however, are
strictly up to you. Which leads to important distinction #2. How do we get
paid? The Reviews are owned by a Public Relations firm
(Institutional Analyst Inc.) that specializes in getting (or creating)
coverage for publicly traded companies. As such, is important to note that
anytime we say anything about a company, it is because the company is a
client of our parent company, or because we would like them to be a client
of our parent company. In a nutshell, you can throw out any thoughts of us
being even a little bit impartial. It just ain't gonna happen. We love
everyone. Final note is we that have over 20,000 subscribers so please
excuse our dust. Institutional Analyst Inc. is an independent research and
investor-relations consulting firm that publishes investment-research
reports such as The Reviews on independently selected
companies. While it is its intent to identify and research companies that
it believes might prove to be profitable investments, The
Review is not liable for any investment decisions by its readers. Neither
The Reviews nor any report published by Institutional Analyst
Inc., represent a solicitation to buy or sell the securities discussed
within the report. It is strongly recommended that any purchase or sale
decisions be discussed with a financial adviser or broker prior to
completing any such purchase or sale decision. The information contained
herein is provided as an information service only and is based upon
sources deemed reliable, but not guaranteed by The Reviews.
Past performance of previously featured companies does not guarantee the
future success of any currently featured or mentioned company. The
information contained herein is subject to change without notice, and The
Reviews assumes no responsibility to update the information
in this or any report published. Use of this or any report published by
The Review may be subject to the applicable rules of
certain self-regulatory organizations and the securities mentioned herein,
which are traded Over The Counter, and may not be cleared for sale in
certain states. Institutional Analyst Inc and/or its employees, officers,
affiliates or members of their families may have long or short positions
in any of the securities discussed in this or other reports published
herein (and/or options or warrants relating thereto) and may purchase and
or sell these securities, options or warrants from time to time in the
open market or otherwise. Institutional Analyst Inc may derive
compensation through research services and subscriptions and/or
investor-relations consulting from the companies featured or mentioned in
its reports. Write or call Institutional Analyst Inc for disclosure
details as required by Rule 17b as it relates to individual issues.
Institutional Analyst Inc., In no event shall The
Reviews report be liable for direct, indirect, incidental or
consequential damages resulting from the use of this information. The
Reviews shall be indemnified and held harmless from any
actions, claims, proceedings or liabilities with respect to the
information herein. Institutional Analyst Inc is not a securities
broker-dealer, investment advisor or a securities exchange and is not
registered as such with the Securities and Exchange commission nor any
state securities regulation authority. Readers of this e-mail newsletter
should recognize that the Reviews are only providing a
delivery service to electronically transmit information to potential
investors. In this respect, the Reviews are no different than
the provider of any other delivery service such as the United States Post
Office or any other express delivery service. Accordingly, investors
should be aware that the Reviews have not evaluated nor
investigated any of the companies listed in this e-mail to determine their
merit or the risk of investment in any such company. The Reviews do not
endorse any company listed herein and the Reviews do not
represent that the information contained in any offering documents states
all material facts or does not omit a material fact necessary to make the
statements therein not misleading. firstname.lastname@example.org
Disclosure: I am long OMEX.