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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Paul Senior who wrote (47090)	3/16/2012 4:09:39 PM
From: Grommit	Read Replies (1) \| Respond to of 78751

I see your point now. You buy car when the economy is crappy and therefore should buy the stock too. How far down the supply chain do you buy -- paint companies, steel companies too? :o) You could buy any stock when the economy is crappy for a bet on the turnaround, but it doesn't need to be stock in a car company just because you bought a car.

To: Paul Senior who wrote (47090)	3/16/2012 4:50:28 PM
From: reno4	Read Replies (1) \| Respond to of 78751

HDSN (Hudson Technologies, Inc) $3.72, cap 88M, trailing PE 92 How's that for a value stock? They are the only publically traded company selling R22 refridgerant--R22 is used as a coolant for 60% of all cooling sytstems (AC, refridgerators, etc.) in US. It's a fragmented market with lots of small players and they have 20% market share. Since 2004, the EPA has been limiting the production of R22 becuase it's bad for the ozone. Last month EPA announced plans to further reduce R22 production (http://www.hudsontech.com/wp-content/uploads/2012/03/EPA-R22-FactSheet.pdf). Since then the price of R22 has skyrocketed along with the stock price of HDSN. Last year 30lbs cylinder costed $160. It now costs $425 (http://www.r-22.com/). So for this year their earning from their virgin gas sales should increase significantly. They have additional drivers for earnings. (1) Recycling: They have a patented process for recycling the R22 gas. This is the reason EPA is limiting production of R22, to increase recycling. In the past when R22 was cheap, the contractors had little incentive for reclaiming the R22 gas. Although illegal, it was easier for them to vent the R22 into air and sell their customers virgin gas. Now with signifcant increase in price of R22 they are going to get much more recycling business. This has higher margins than selling virgin gas. They already have the infrasturcture to handle significantly more volume without additional capital expense. (2) Joint venture in Europe starting this year. Price of the stock has moved up quite a bit, but I think there is more upside. How much? Not sure. But if you use their invstor presentation projections, you can get a estimate of $1/sh in earning from just recycling at R22 price of $14/lb (approximate current price). Plus you get additional revenues form virgin R22 sales and European joint venture making this a "value" stock. They have a good investor presentation on their website: hudsontech.com