I have no argument with management's pay being high.
The current technology is piston driven and not nearly as efficient as what ERII has introduced into the marketplace. The skid formfactor, in my opinion, is not the significant difference here. Sinopec, in a pilot program, is on record as saying that they reduced their electricity use by 25% in a year, and the CEO's stated interest by oil and gas (also in the CC transcript) would suggest that the energy savings over the current technology is what this is all about.
blog.energyrecovery.com
I think I mentioned in my previous post that this is not a traditional value play, though their margins, their balance sheet and their market share in the lumpy desal business are admirable.
Regarding valuation, EKS mentioned in the previous post the recent schedule 4's that have been filed.
nasdaq.com
Lorentzen Ole Peter recently bought a million shares at 5.21. He is not an insider but a beneficial owner of more than ten percent of the stock. To my understanding, he was involved with company previously and has now returned with large purchases of the stock. He is seeking a position on the board. The direct buys and direct option exercise by two directors for over 130,000 shares, in my opinion, confirms my belief that this company has something unique to offer. Robert Mao's background is in material science so I find his purchases compelling. Below is an excerpt regarding his background.
Mr. Mao is a graduate of Cornell University with a bachelor's degree in Materials Science and a master's degree in Metallurgical Engineering. He also holds a master's degree in Management from the Massachusetts Institute of Technology. |
