Mariner research report thoughtsThe Mariner Research article is a poorly put together attempt to bolster their short position.
It's quite laughable when one of their biggest arguments against PYR is that they can’t compete with Stratasys and 3D systems… when Pyrogenesis is a 3D printing material provider and not a 3D printing 'OEM' company. Speaks to the Due Diligence that these guys do. ARK’s 3D printing ETF doesn’t include only 3D printing OEMs but also powder & material producers like Sandvik, Eastman Chemical and Pyrogenesis... Mariner just listed two potential OEM clients of PYR.
While it is true that Pyrogenesis has in the past highlighted potential opportunities that failed to materialize, the company is in a much different position now than it was years ago. Revenues are growing quickly, the completely different financial situation that PYR now finds itself in (No debt, flush with cash), their offerings are FAR more diversified and developed for commercial readiness than ever before, and they now have the attention of the market and big businesses with the uplistings to TSX and NASDAQ. These are evidence that PYR is ripe for continued success.
The report fails to highlight the advances in PYR’s powder production line (or really any improvements/repositioning in their business lines which have led to the renaissance of PYR over the last year/two:
1) Their entry into the 1+ MW (high-power) torch business whereas previously they only did smaller units of < 500 kW that would not have been practical for Iron Pelletization or replacement of fossil fuel burners in general.
2) The addition of high-value materials that complements their already superior DROSRITE product for Aluminum Dross processing, and the addition of the “Tolling” option for DROSRITE.
3) The fact that over the last few years their AM powder production system has undergone tremendous R&D advances, from a 1kg/hr production rate (their pre 2015, original technology) to 5 kg/hr (2015) to now a 25+ kg/hr, which by far surpasses any other Plasma Atomization powder producer (AP&C is at 10-13kg/hr, and Tekna is 5 kg/hr from what I could find).
4) The discovery that PUREVAP technology can be used to address the growing need for Silicon as a Lithium-ion Battery Anode Material and the creation of the PUREVAP NSiR for this purpose.
5) The discovery that their Plasma torches can be used to enter a new market (Tunneling) whose opportunity may be even larger in scope than first anticipated, and continued work to develop torches for this purpose.
6) Addition of RNG production systems (& Hydrogen?) to their portfolio of offerings via the AirScience acquisition.
In particular, the impact of this improvement in PYR’s AM powder production rate + reduction in OPEX costs from the tightening of powder yield or “powder size distribution” (basically by narrowing the size distribution of particles produced, less waste powder needs to be stored to find another buyer, or even thrown away) is tremendous in that it will increase profitability while also allowing PYR to be super competitive in the market, attracting interest from anyone who currently needs well-priced, high quality, spherical, consistent AM powders.
Pyrogenesis’ torch offering is patented for Iron Pelletization and these companies are under tremendous pressure to begin addressing their GHG emissions, a big part of which comes from their fossil fuel burners. Pyrogenesis’ torches represent an easy solution, plug & play, and one which is commercially ready & economically viable, to address this need. Peter has said that everything is going well with the Iron Pelletization companies & their other interested clients – there is a strong likelihood that PYR’s torches will be part of their GHG reduction solution.
Also, Pyrogenesis not being a client of the US Navy? If you go back through their years of news releases (and even news prior to them going public) you will see the depth of the relationship PYR has with the US Navy. There are many projects they have done for them and PYR being included in the US Aircraft carrier build is a testament to the incredibly thorough Due Diligence that the US Navy has done over the years to vet Pyrogenesis’ technology and company. Regardless of who is contracted to construct the ship, the US Navy is an integral part in vetting and selecting those companies whose components are included, and PYR is cemented in the design of the aircraft carrier for a reason.
While the report does have shreds of truth to it, the massive amount of misleading & false information, and the omission of anything positive in the company’s developments which have led to the growth in SP and investor interest (all short reports do this) make it a complete flop and not anything to worry about if you are a long-term investor. Pyrogenesis has repositioned itself as a GHG reduction specialist at the perfect moment when the world is heading in this direction, and their offerings are all poised for tremendous growth. This report is just a fart in the wind, and its unpleasant odor will soon be long forgotten.