RE:RE:RE:RE:RE:RE:RE:short position I actually just had a really good conversation with Ali @ Spinnaker (Emblem's IR firm) about this. I was asking why the company has been so tight-lipped about plans since he came on board in March.
He echoed the same comments I have made about how the previous IR firm that Emblem employed made completely outlandish and unrealistic statements about Emblem's business plans.
While this did boost Emblem's SP and enabled them to do a nice equity deal with little dilution at the beginning of the year, that deal was done at the expense of people buying into raise (i.e. new Emblem shareholders) as they were buying into a massively overpriced stock. This runs completely counter to what an IR team is supposed to do, it is supposed to represent all shareholders' interests (both old and new) by ensuring that the stock is trading at a fair valuation, not a massively inflated one. Making false statements to get the share price running way beyond its fair market value based on the real fundamentals only serves the insiders that got into the company on the pre-public issues by allowing them to dump their cheap shares on unsuspecting smucks like us. These are my words, not his.
He said that the first thing he did when came on board was to stop all that nonsense. He said his style is to under promise and over deliver so that shareholders can feel confident that they will actually deliver on what they are promising. While that short-lived runup in share price may feel nice at the beginning you eventually have to pay the piper when eventually people realize that you haven’t delivered on what you promised. You can talk up a company all you want but eventually you are going to be judged on your financial statements and if they do not live up to the promises look out below on the share price.
This is essentially what is happening to Emblem now and I believe will eventually happen to most of the other companies in the sector. This fact makes Emblem one of the best plays in the sector as of today in my opinion as they have much less downside risk and much more upside potential than most of the rest of the sector though I know that does not give much comfort to the people that bought in @ $4+ but it is what it is.
When I asked Ali point blank why they have essentially gone dark since he has been around he was very candid in saying that they essentially had no good news to share so they were staying quiet until they did. This makes sense to me, he was essentially setup to fail by Dan Brody’s outlandish propaganda. (Warning, Dan is now playing the same tricks at TGOD so stay away from that one).
Ali did assure me that we will hear much more from them over the next 3-6 months as they actually will have good news to share as they execute and reach significant milestones. I do believe there will be some significant news out about some of these plans next week.
He also did confirm that they have not been advised of any deficiencies from the HC oil license inspection and are just caught in the slow moving government bureaucracy. He also confirmed that a new investor’s deck will be out after the earnings are released.