publicly traded charity - takeover needed?I've been meaning to share some thoughts for a while to see if others see it the same way.
The climate (pardon the pun) couldn't be better for a company like GRN: gas prices through the roof thanks to Russia; governments throwing legislation and subsidies at green energy initiatives everywhere; and GRN has a competitive advantage in being debt free, while some competitors may be facing interest rate headwinds.
As expected, GRN keeps announcing new sales records each quarter, and yet their sales are breakeven at best, with more of the same forecast by analysts for coming years. I'm beginning to look at the RNG industry like commercial (ie: metal) 3d printers, in that the manufacturers of the printers have fabulous technology, but they can't seem to sell them at a profit. In addition, there is generally little or no recurring revenue, and the buyer may not need a replacement unit for years.
The end user of the metal printer, however, (aerospace, automotive, ...) benefits in using the technology, presumably improving efficiency enough to justify the price tag.
That's why I think
producing and selling RNG, not installing the upgrading equipment, is the space to be in. I own a small electric facility with a 20 year power purchase agreement = predictable, long term, profitable revenue stream. The manufacturer of my equipment was struggling, last I heard.
Call me simple, but when I realized a year ago that GRN's book value per share wasn't going to increase in the foreseeable future, I lost interest. What renewed my interest was mgt's talk of equity investment in producers. They have made a couple of token loans that may translate into equity, and, therefore, recurring revenue someday, but for all the hype, it amounts to a pittance. The only ways I can see share price taking off are:
- substantial new equity in producers and/or
- acquisition of a company with profitable business model or
- becoming an acquisition
Thoughts?