This company should be looked at,
Jan 30, 1999
DCH TECHNOLOGY, INC.
("DCHT" on OTC - BB)
27811 Avenue Hopkins #6
Valencia Ca. 91355
IR Dept. (805) 775 - 8120 ext. 11
Website: dcht.com
IR Email DCHTinvest@aol.com
Shares Issued: 11 million (fully diluted)
Float: 3.4 million
Current bid/ask: 1 1/8 by 1 9//32
First recommended Jan 15, 1999 at 31/32
Last Trade: 1 9/32 (Jan 28, 1999)
DCHT is a leader in the development and production of state-of-the-art environmental monitoring and safety-engineering products for hydrogen industrial uses.
DCHT has licensed and developed a universal gas detector and has recently begun selling state-of-the-art hydrogen gas sensors, targeting a potential US$2 billion market.
DCH Technology is on the verge of commercial development of PEM Fuel Cells - a product that will revolutionize power production and transportation in the 21st century.
DCHT's 5 year sales forecast for the Robust Hydrogen Sensor at $105 million and $ 26 million in net profit. The above forecast does not include any of the other products currently in development making the 5 year sales forecast very conservative in our opinion. dch-technology.com
THE COMPANY
DCHT was started in 1994 as an engineering safety and gas detection and hydrogen sensor manufacturing company.
DCHT's flagship product is the "Robust Hydrogen Sensor" (currently in production), and is aimed at an estimated US$ 200 million market.
DCHT's gas sensor products are aimed at a worldwide market with potential sales estimated at US$2 billion per year.
DCHT is teamed with the US Department of Energy and the Los Alamos National Laboratory to commercialize a small hydrogen fuel cell capable of generating from 50 watts to 500 watts, or more, of portable electrical power. DCHT believes that this product could be available for worldwide distribution in mid 1999. Companies in Japan, Europe, and the US are readying production lines to satisfy fuel cell markets worth several billion dollars annually, in then next ten years. (source PR newswire Jan 26, 1999)
BACKGROUND
The hydrogen economy is upon us. There is renewed attention on global warming and air pollution this week in Washington. Words like fuel cells and alternative energy sources are becoming belt-way buzzwords. Just this week two proposals were sent to Congress from the Clinton Administration; the first a $4.05 Billion request for alternative and renewable energy technology development and the second, a $3.6 Billion tax cut for businesses and families to use renewable energy products. Within those requests come the following excerpts; (source Reuters Jan 26, 1999)
In 2000 alone, Clinton wants federal agencies to spend $1.4 billion to
develop solar, wind and thermal technology and better ways to store
and use hydrogen.
Clinton also wants the Department of Energy to work to develop more
energy-efficient kitchen appliances, computers and air conditioners.
The tax credits and a fiscal year 2000 request for an added $1.4
billion in federal grants are aimed at promoting development and use
of renewable energy to slow global warming.
This is an enormous opportunity for a company like DCHT who has been quietly preparing to capitalize on the rapidly growing need for sensors and safety systems for the emerging hydrogen economy. In order for hydrogen to become widely accepted, it must be made safe. Hydrogen is explosive when it reaches just 4% concentration in air, therefore monitoring and measuring the gas in order to activate safety control equipment or to sound an alarm is vital to avoid hazardous situations.
Process monitoring based on reliable, fast and accurate measurement is important to many industries such as; oil refining, glass making, plastics, energy, medical, waste management, environmental, manufacturing, food, military and aerospace.
DCH sensors meet the need safety needs and requirements wherever hydrogen is present.
Some current DCH customers include NASA, General Dynamics, General Electric, Ford, Westinghouse, Allied Signal, Dow Corning, General Motors, Lockheed Martin Defense Systems, The US Naval Medical Research Institute, and a number of other internationally-known aerospace, automotive, nuclear and defense industry clients.
DCHT is also teamed with all of the major US National Labs including Sandia, Los Alamos, Oak Ridge, Simon Fraser University and the National Renewable Energy Lab.
DCHT is currently teamed with Westinghouse and the European Bank of Reconstruction and Development to retrofit the Leningrad nuclear reactor with hydrogen sensors and has already begun delivery on November 2, 1998. (see press release). DCHT is in discussion with Westinghouse to team on safety upgrades to nuclear facilities throughout the world. There are between 275 and 350 nuclear power plants worldwide.
DCHT is also leading the Maritime Hydrogen Technology Development Group, which plans to retrofit a ferry in Hawaii with hydrogen power as a testing and demonstration platform. DCH's partners in the MHTDG include Pacific Marine, Allied Signal, Northrop Grumman, LANL, Thiokol, HBT and the Desert Research Institute.
DCHT believes that there is vast untapped revenue potential in the power transformer and semiconductor industries. Power distribution transformers are found on hydro poles and industrial facilities across the country. During operation, hydrogen is naturally generated in the transformer cooling oil. Elevated levels of hydrogen in the oil indicate a malfunction and/or an imminent failure. The DCHT sensor will allow monitoring of these hydrogen buildups and signal maintenance crews to repair the problem before the transformer fails or explodes. DCHT expects this to be a source of tremendous profit.
In semiconductors, when large quantities of hydrogen are accumulated in semiconductor manufacturing plants, much of it is burned off in furnaces. A sensor is needed to monitor the hydrogen accumulation in these burners. Only the DCHT sensor is robust enough to handle this harsh environment. DCHT estimates this and related process monitoring applications could potentially generate sales of $18,000,000 annually.
HYDROGEN-POWERED FUEL CELLS
DCHT is now teamed with the US Dept. of Energy and the Los Alamos National Lab to commercialize a small hydrogen fuel cell capable of generating from 50 watts to 500 watts, or more, of portable electrical power. DCHT believes that this product could be available for worldwide distribution in mid 1999.
A fuel cell is a device that uses a fuel (typically hydrogen, although methane or natural gas can also be used) to create electricity. Hydrogen is the most abundant element in the universe; it is also one of the most energy-efficient fuels available.
Fuel cells create clean electric power with pure water and a little heat as the only by product. Today, when investors think of fuel cells, they tend to think of Ballard Power Systems, and their R&D work in developing fuel cells to power electric vehicles.
While there are a number of interesting comparisons that can be made between DCHT and Ballard Power Systems, Ballard is primarily developing fuel cell power technology for large stationary power systems, and secondarily for transportation while DCHT is focussing on the smaller consumer sized design for "portable" electric power.
However, in 1998, shares of Ballard Power soared from $10 to $188 (prior to a 3-for-1 stock split) on the Nasdaq and Toronto Stock Exchanges. Ballard Power's $2.1 Billion market cap and share price levels are attributable to investor excitement about the company following the announcement of a strategic alliance between Ballard Power and Daimler-Benz and Ford to make fuel cells for cars, buses and trucks.
We think the same thing will happen for DCHT as they now have their own impressive list of strategic partners in five of the top ten United States Aerospace and Defense
Companies. It's latest advances in the areas of fuel cell technology and remote hydrogen sensor applications are propelling this company to the forefront of a rapidly growing industry at a time when the industry is getting hot!
LATEST DEVELOPMENTS
Friday, Jan 22, 1999, DCHT announced the election of 20 year Pennsylvania Congressman Bob Walker, the author of the $ 100 Million Hydrogen Future Act of 1996 to their Board of Directors. Bob Walker is now the president of the Wexler Group, with partner Anne Wexler who has been called one of the most powerful lobbyists in all of Washington. (source wexlergroup.com
This is considered by us to be extremely timely for DCHT with that $ 4.05 Billion proposal for FY 2000 to fund alternative energy research and to fight global warming and the $3.4 Billion in tax cuts proposed by the Clinton Administration earlier this week.
DCHT Chairman Dave Haberman is also no stranger in Washington. On Nov. 18, 1998 he was appointed to the Hydrogen Technical Advisory Panel (HTAP) to the U.S. Congress, by Dept. of Energy Secretary Bill Richardson. HTAP reports to Congress on the Department of Energy's implementation and appropriations pursuant to the Hydrogen Future Act authored by Bob Walker and signed into law in 1996.
With the recent initiatives by industry and now government, momentum is building for a strong showing for DCHT at the 10th Annual Hydrogen Association convention outside Washington, DC on April 7-9, 1999. The keynote speaker at the convention is John E. Peterson, (R-PA) who sits on the House Appropriations Committee.
DCH Technology will be showcasing its prototype PEM fuel cell at the convention along with its full family of sensor line. DCHT believes that their smaller portable fuel cells are more economically viable and will be brought into commercial development far sooner than the larger units being developed to power electric vehicles and homes, thus giving DCHT an edge over Ballard and other fuel cell developers.
The DCH Technology story is only just now coming to the attention of major market players, individual investors, analysts and newsletter writers and is considered by us to be an extremely undervalued gem with limit less upside potential.
Trading Strategy
For short term traders we feel an investment in DCHT at the $1.00 to $2.00 levels provides an extraordinary low risk opportunity with an upside potential of between $5.00 and $6.00 per share short term, and between $6.00 and $9.00 per share in 2000.
For longer term aggressive investors with the appropriate risk tolerance we recommend buying up to $4.00 or $5.00 and holding for the long term.
For more information, please contact
DCHT Investor Relations -
Phone: (805) 775 - 8120 ext. 11
Email: DCHTinvest@aol.com
Website dcht.com
Disclaimer
RESEARCH INVESTMENT GROUP is not a Registered Investment Advisor or a Broker / Dealer. This communication (print or electronic) reflects opinions about DCH Technology, Inc. Readers are advised that this electronic publication is issued solely for information purposes and is not to be construed as an offer to sell or the solicitation of an offer to buy. The opinions and analysis included herein are based on publicly available sources that are believed to be reliable and in good faith but no representation or warranty, expressed or implied, is made as to their accuracy, completeness or correctness. This information is not intended to be used as the sole basis of any investment decisions, nor should it be construed as advice designed to meet the investment needs of any particular investor. The foregoing discussion contains forward-looking statements, which are based on current expectations and differences can be expected. The information contained herein has been obtained from publicly available sources and disseminated by RESEARCH INVESTMENT GROUP for information purposes only. In addition, the information contained in this report is not intended to be a complete discussion of information regarding some of the current and/or intended business activities of the Company. Readers are urged to consult with independent financial advisors with respect to an investment in the shares mentioned herein. Investors should review a complete information package on DCH Technology, Inc. (the "Company"), which should include, but not be limited to, the Company's annual report, quarterly report, press releases, as well as all regulatory filings. DCHT expects to become a reporting company in 1Q 1999. All information contained in this report should be independently verified with the Company mentioned herein. Any opinions expressed in this report are statements of judgment as of the date of publication and are subject to change without further notice, and may not necessarily be reprinted in future publications or elsewhere. Neither RESEARCH INVESTMENT GROUP nor its officers, directors, partners or employees/ consultants accept any liability whatsoever for any direct or consequential loss arising from any use of this report or its contents. RESEARCH INVESTMENT GROUP has received a retainer fee of 50,000 free-trading common shares of DCHT from RAM Capital Management, an independent consultant to DCHT. RAM has paid for consulting services including, but not limited to this research report and its dissemination, project analysis, assistance in locating funding sources as well as evaluating and reporting on projects the Company may have acquired or seek to acquire in the future. Prior to RESEARCH INVESTMENT GROUP disseminating this information, RAM has reviewed the contents hereof. RESEARCH INVESTMENT GROUP, its officers, directors, partners, employees and consultants may profit in the event the shares of the Company increase in value. These positions may be liquidated from time to time even after RESEARCH INVESTMENT GROUP, its officers, directors, partners and employees consultants have made positive comments on the Company. THE READER SHOULD VERIFY ALL CLAIMS AND DO THEIR OWN DUE DILIGENCE BEFORE INVESTING IN ANY SECURITIES MENTIONED. INVESTING IN SECURITIES IS SPECULATIVE AND CARRIES A HIGH DEGREE OF RISK.
We encourage the reader to review the investing information available with the Securities and Exchange Commission ("SEC") at sec.gov sec.gov and / or the National Association of Securities Dealers ("NASD") at nasdr.com
Readers will be able to review the companies annual report on its web site sometime after Jan 22, 1999. As DCH is not yet a reporting company, public filings are not available from the SEC's EDGAR page.
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