Ladies and gentleman you may not know it, but we are smack dab in the middle of a micro-cap stock market bull run that is trending higher according to the profit taking in large cap and mid cap. It seems that most investors can buy size and a meaningful position in a stock if they can accumulate below stocks of $5 bucks a share or less as opposed to buying stocks at $100 plus per share. The $100 could go to $200 but what if the $5 stock goes to $20. Sure many things have to happen before that happens, mostly good. There is by no means any guarantees of either event taking place, however, chances are that an investor is more at risk buying a $5 stock rather than a $100 stock but if you can buy 20 times more shares and you can afford the risk, hmmm, risk vs. reward could get interesting, especially in a bullish micro-cap market.
In the stock market it’s never “better late than never” and never is a long time. This market is going to get overheated from all this buying whereby even stocks nobody wants are going to start to move. Once that happens the word late could appear on my lips.
So lets review: before we run out and load up on micro-caps. Don’t lose your normal decision making structure or invest over your head. Do not listen to advice of others who could be selling you what they are telling you to buy. Get some research materials, get some information, read the web, check out solid companies and be weary of flyers. And lastly, if you are late, never ever chase!
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OTC Markets Group Website: http://www.otcmarkets.com/home
OTC Markets Group Inc. (OTCQX: OTCM) operates Open, Transparent and Connected financial marketplaces for 10,000 U.S. and global securities. Through their OTC Link® ATS, the company directly links a diverse network of broker-dealers that provide liquidity and execution services for a wide spectrum of securities. The company organizes these securities into marketplaces to better inform investors of opportunities and risks – OTCQX®, The Best Marketplace with Qualified Companies; OTCQB®, The Venture Stage Marketplace with U.S. Reporting Companies; and OTC Pink®, The Open Marketplace with Variable Reporting Companies. The company’s data-driven platform enables investors to easily trade through the broker of their choice at the best possible price and empowers a broad range of companies to improve the quality and availability of information for their investors. SNNLive spoke with Wendy Fraulo, CFO of OTC Markets Group at the 25th Annual ROTH Conference 2013 in Laguna Beach, CA.
“At OTC Markets Group we have three main business lines. Our first, is our trading services platform. We recently, in 2012, had our OTC Link LLC get our broker dealer license. We now operate our trading platform underneath our OTC Link ATS operations, and so that has been a great success in 2012. In addition, we have our market data licensing business line, and really that’s reselling our proprietary information that’s generated from our OTC Link ATS trading platform. Our third business line is our issuer services business line and we have a wide range of great companies that are trading in the OTC space that have an opportunity to promote themselves on the platform. So it’s a big company and three strong business lines that we are very proud of,” Ms. Fraulo begins. Wendy Fraulo joined OTC Markets Group as CFO in July 2011. Wendy has over 12 years of public accounting experience. Previously, Wendy was a Senior Manager in M&A Transaction Services at Deloitte & Touche LLP for four years and worked with major private equity firms and strategic buyers. Prior to that, Wendy was a part of Deloitte’s Technology, Media & Telecommunications Group within the Assurance practice, where the majority of her audit clients were large SEC registrants.
“It’s been amazing. When you talk about our issuer services business line, we have tiered the marketplace. We have our QX tier. At the end of the year, we had about 400 companies on the QX tier. These are qualified companies that get validated by their sponsors and they’re great companies; foreign and domestic. We also have the QB tier, a lot of SEC reporting companies, again, a lot of great companies in there. Then we have our PINK tier, OTC PINK tier, and it’s really the open marketplace for a large variety of companies. We’ve seen a lot of change in this space over the past 10 years”, she continues, “What we do is we try to make sure that there is a regulatory environment, but we’re trying to make it as least complex as possible. So, it’s really we give companies an opportunity to promote themselves through a regulatory scope, but not a complicated regulatory scope. So it’s an exciting opportunity. We have 1500 ADR’s in this space, we have 700 community banks in this space, a lot of SEC reporting companies, and a lot of amazing international companies. We have Roche on our QX platform, Adidas…Volkswagen…They’re huge companies doing great things. So we’re very excited to be able to promote them and that they can use our services.”
When asked about what area will provide OTC Markets future growth, Ms. Fraulo explains, “All of our three business lines are very strong. Talking about 2012 specifically, most of our growth came from our issuer services business line. We had a 37% growth in QX companies, we added 86 companies. The increased revenue from our OTCQX subscriptions was $1.8 million of our $2.1 million growth. That’s where historically in 2011-2012 growth has come from, but we’re really excited to add to some new index and securities on this space in 2013 and increase our distribution of our market data. We’re hoping our growth continues to come from all of our business lines, but it’s exciting.” For more information about OTC Markets Group, check out their website. SNNLive welcomes Wendy Fraulo, CFO of OTC Markets Group.
Axion International Website: http://axih.com/
AXION (OTCQB: AXIH) is green technology company, transforming waste plastics into structural building materials. Using 100%-recycled consumer and industrial plastics, AXION develops, markets and sells its recycled structural composite products through its ECOTRAX™ composite railtie and STRUXURE™ building material lines. From the railroading industry to the military to global engineering firms, AXION delivers tested, proven and superior green solutions to infrastructure needs around the world. SNNLive spoke with Steven Silverman, President and CEO of Axion International Inc. at the 25th Annual ROTH Conference 2013 in Laguna Beach, CA. “Axion International is a company that’s based on a portfolio of patents that was developed at Rutgers University based on polymer science using recycled plastics and plastic composites to make infrastructure building products for use in railroads, bridge structures, boardwalks and marinas,” Mr. Silverman begins, ”The basic ingredient in our product is milk jugs, laundry detergent bottles, shampoo bottles, better known as HDPE or Number 2 plastic recycled in the consumer stream…our products are 100% recycled. The best part about our product is that even after its useful life the product is recyclable again.”
“Early in 2011 the company came out of its proof-of-concept phase if you will, where we had trials with the Army core of engineers, various railroads had tried our product and tested very well. In 2011, the company started on its marketing and growth phase and very quickly we’ve ramped a sales pipeline. We’ve got about 58 opportunities in our pipeline, its over $40 million in potential revenue…the main focus is that we’re an alternative building product to steel, wood and concrete. Those products have some inherent issues, such as, rotting, corroding, they require maintenance. Our products don’t rot, they don’t corrode, they’re completely impervious to the outdoor elements…Our products age very well. We’ve had extended weather testing done on our products at the University of Illinois…and the products have been tested beyond 40 years of life,” Mr. Silverman explains.
When asked how Axion’s customers implement their products, he explains, “Well, in the railroad business its pretty basic. In the US, they replace over 20 million rail ties a year, here in the US alone. The company has expanded its growth opportunities internationally. We’re now in trial or testing or our products have been purchased in every continent in the world, with one exception, Antarctica…our products have been used in a bridge structure, for example, to build a whole new bridge or just as a decking to a bridge to replace the deck surface.” Mr. Silverman then describes the portability of Axion’s products, “So our products are lighter than steel or wood and concrete, they are easier to build with, so, for example, we pre-fabricated a 90-foot span bridge, six 30-foot panels…loaded in ocean containers, shipped to Scotland, and they built a beautiful bridge, which is on our website…this bridge is over the Tweed River on a private property, it’s a beautiful place. It holds heavy vehicular traffic. The other adoption that took place this year was we built the first two highway bridges in the US, built 100% out of recycled plastics, one in Maine and one in Ohio…we’ve also had a great adoption up in Canada with the various transit lines now buy our products on rail tie side.”
“Unfortunately, in this country, we only recycle about 30% of the available plastics. We look at ourselves, and now we’re talking to municipalities and governments about being able to take more waste and putting it to good use and rebuilding infrastructure. So what makes us different is we are an infrastructure product. We’re not a retail plastic lumber product. Our product is used in heavy use applications to rebuild infrastructure, which everybody knows, President Obama mentioned it in the State of the Union address, that there is 70,000 bridges that need to be replaced in the US,” he continues. For more information about Axion International, check out their website. SNNLive welcomes Steven Silverman, President and CEO of Axion International.
CRAiLAR Inc. Website: http://crailar.com/
CRAiLAR Technologies Inc. (OTCBB: CRLRF) offers cost-effective and environmentally sustainable natural fiber in the form of flax, hemp and other bast fibers for use in textile, industrial, energy, medical and composite material applications. Produced using a fraction of water and chemical inputs compared with other natural fibers, CRAiLAR Flax is the newest natural fiber introduction to the market in decades. The Company supplies its CRAiLAR Flax to HanesBrands, Georgia-Pacific, Brilliant Global Knitwear, Tuscarora Yarns, Target Corp. and Kowa Company for commercial use, and to Levi Strauss & Co., Cintas, Carhartt, Ashland, PVH Corp., Cotswold Industries, Cone Mills and Lenzing for evaluation and development. The Company was founded in 1998 as a provider of environmentally friendly, socially responsible clothing. SNNLive spoke with Ken Barker, CEO and Director of CRAiLAR Inc. at the 25th Annual ROTH Conference 2013 in Laguna Beach, CA. “CRAiLAR is the first natural fiber alternative to cotton that the industry has ever had. It’s significant because to date, we’ve never been able to blend an alternative fiber than cotton in a pair of jeans or a t-shirt without being able to tell the difference,” Mr. Barker begins, “if I gave you a polyester cotton garment to where right now, you’d be uncomfortable, you’d be sweating under these lights…the fabric doesn’t breathe, but the biggest problem is that cotton is highly toxic, it has a very bad sustainability footprint and it is in diminishing supply as global demand grows in this category. We have to find an alternative. CRAiLAR is that alternative.
When asked to describe how their technology works, Mr. Barker explains, “Well, it’s an enzyme process that effectively takes the fastest growing fibers in the world, flax, hemp, jute and kenaf, and turns them into usable grade fiber indiscernible from cotton that enters existing cotton mainstream production,” and as Shelly points out its not the leaves, the fruit, the buds, but the, “stalk of the plant”, in which Shelly states is a waste product, and Mr. Barker states, “in some industries it is too, but it also gives us some interesting performance characteristics. The fiber wicks moisture, reduces shrinkage, saves on dye stuff, and as I said earlier, the most important point, you can’t tell the difference when you blend it with cotton.” Mr. Barker goes on to discuss the company’s process, “We’re in the fiber business. We contract with farmers, harvest the crop, run it through our process and we deliver a bale of fiber that looks just like a bale of cotton. That’s our process…and we’ve attracted the best and the brightest of the brands in this category. We’re in partnership with Georgia-Pacific and HanesBrands. Cone Denim, who have made denim for Levi Strauss for decades. Target, for domestic textiles and we’re expanding that into apparel, and we’re in dialogue and in agreement with Phillip Van Heusen for dress shirts and they just bought Calvin Klein denim. H&M in Sweden. Ikea in Sweden. There are lot of opportunities for us and a lot of brands that are very eager to see us succeed.”
Shelly then asks Mr. Barker what is the number one use in the finished garment category for CRAiLAR’s product, where he responds, “Denim holds the biggest opportunity. American consumers would wear denim four days a week if they could and the category is significantly bigger than any other.” Since joining CRAiLAR Technologies in 2006, Mr. Barker has served as Chief Executive Officer and as a member of the Board of Directors, guiding the company’s strategic vision and creating marketing and operational platforms that now place CRAiLAR Flax Fiber in the global marketplace. He brings almost 30 years experience in the apparel industry to CRAiLAR, including adidas, where he was head of apparel for adidas® North America, and, prior to that, Levi Strauss & Co., as general merchandise manager at Levi’s and Dockers Canada. For more information about CRAiLAR Inc., check out their website. SNNLive welcomes Ken Barker, CEO and Director of CRAiLAR Inc.
Verenium Website: http://verenium.com/
Verenium (NASDAQ: VRNM), an industrial biotechnology company, is a global leader in developing high-performance enzymes. Verenium’s tailored enzymes are environmentally friendly, making products and processes greener and more cost-effective for industries, including the global food and fuel markets. SNNLive spoke with James Levine, CEO of Verenium Corp. at the 25th Annual ROTH Conference 2013 in Laguna Beach, CA. “Verenium is an industrial enzymes company. We produce products that go into products like animal feed, that goes into corn ethanol, that goes into hydraulic fracturing to make these processes greener, as well as more efficient,” Mr. Levine begins, “We produce enzymes as well as developing them that are selected from nature for their performance, and then manufactured at commercial scale for our customers to purchase, but most important, it’s about providing the customer not with just a green solution, but with a solution that is more efficient for their operating needs.”
When asked about how many industries Verenium supplies, Mr. Levine states, “Right now we supply three industries, and our largest industry is the poultry industry, where we supply an enzyme that allows chickens to access nutrients that’s in their food that they otherwise couldn’t access. It saves customers money and it provides a better solution than a chemical alternative that might be used…the other two industries that we serve are corn ethanol and hydraulic fracturing, and we’re looking to expand into four additional industries in baking, detergents, personal care, and sweeteners.” Shelly then asks Mr. Levine how enzymes increase the value for the customer: “What enzymes do is replace a chemical process with a biological process, and a biological process has the opportunity to be more efficient. So you might be replacing something like a 50lb bag of dicalcium phosphate from a ton of animal feed with a thimble full of our enzyme to get the same or even a better result.” When asked about expanding internationally, Mr. Levine responds, “The way we look at our markets is that we are where our customers need us to be. So in the poultry industry, we’ll sell worldwide. In the corn ethanol industry, it’s largely a domestic US market based in the Midwest and West Coast. And then in hydraulic fracturing, once again, we’ll go where the customer needs us to be, largely that’s in the US today, but we do see opportunities to expand overseas.”
On market share, he states, “What we’ve shown in the animal feed industry is that we have a major product with major market share, and so we use that as really a calling card to say we have been able to achieve significant market share in a competitive market. Our goal now is to enter into new markets to grow the business.” Mr. Levine concludes by saying: “There isn’t a limit to what we can do with the platform. We’ve shown that we can create multiple products, we can sell them into markets, they compete with even much larger competitors and they compete well. As we look at where we want to go, we’ve identified the four areas for future growth, those are areas like detergents, personal care, sweeteners and baking, but there is nothing to stop us from going even more broadly at markets as long as the economics make sense.” For more information about Verenium Corp., check out their website. SNNLive welcomes James Levine, CEO of Verenium Corp.
Astex Pharmaceuticals Website: http://astx.com/
Astex Pharmaceuticals (NASDAQ: ASTX) is dedicated to the discovery and development of novel small molecule therapeutics with a focus on oncology. The Company is developing a proprietary pipeline of novel therapies and is creating de-risked products for partnership with leading pharmaceutical companies. Astex Pharmaceuticals developed DACOGEN® (decitabine) for Injection and receives significant royalties on global sales. SNNLive spoke with James Manuso, Ph.D., Chairman and CEO of Astex Pharmaceuticals, Inc. at the 25th Annual ROTH Conference 2013 in Laguna Beach, CA. “Astex is a NASDAQ listed company. Our focus is on hematology and oncology. We have one drug, DACOGEN, that is marketed worldwide in more than 35 countries for MDS and AML patients, Leukemia patients. And then we have two drugs that are in the clinic. One, the next generation Hypomethylater, a drug for Leukemia patients, and another, an HSP90 inhibitor, a drug for a variety of solid tumor indications. Then we have five drugs that are in the hands of partners for which we could earn more than $1 billion of revenues going forward. Finally, we ended last year with $140 million in cash and we anticipate to earn $55 million from the DACOGEN,” Dr. Manuso begins.
“We have two prioritized drugs that are each in three Phase II clinical trials. We expect at the end of this year to have a Phase II proof of concept read out on SGI110, the next generation Hypomethylator. And then, early next year, we’ll give a clear indication as to where we’re going in the Phase III trial on SGI110,” Dr. Manuso continues. As to where these clinical trials will take place, he states, “Clinical trials are typically done internationally. What we find is that is makes more sense to introduce the drug early on to many jurisdictions around the world…very clearly, our experience has been that a good drug should find an international market, and if your intention is to ultimately generate a drug that could be sold worldwide, you want to introduce it to the key opinion leaders around the world early.”
Dr. Manuso goes on to expand on DACOGEN: “Well, DACOGEN, the marketed drug, is an IV administration, and it has been proven to extend the lives of acute myeloid leukemia patients that are elderly, over 65, and that has been a major impact because its the first drug that’s ever been approved for the elderly AML indication, and that’s sold and marketed by Johnson & Johnson in the EU at this time.” For more information about Astex Pharmaceutical, check out their website. SNNLive welcomes James Manuso, Ph.D., Chairman and CEO of Astex Pharmaceuticals.
Miller Energy Resources Website: http://www.millerenergyresources.com/
Miller Energy Resources, Inc. (NYSE: MILL) is a high growth oil and natural gas exploration, production and drilling company operating in multiple exploration and production basins in North America. Miller’s focus is in Cook Inlet, Alaska and in the heart of Tennessee’s prolific and hydrocarbon-rich Appalachian Basin, including the Mississippian Lime and Chattanooga Shale. Miller is headquartered in Knoxville, Tennessee with offices in Anchorage, Alaska and Huntsville, Tennessee. SNNLive spoke with Bobby Gaylor from Miller Energy Resources at the 25th Annual ROTH Conference 2013 in Laguna Beach, CA. “Miller is a New York Stock Exchange Company. We trade under the symbol MILL. We are in two basins right now. We are an E&P company…oil and gas, and we’re in two basins: the Appalachian Basin in Tennessee and also in Alaska in the Cook Inlet. We got about 50,000 acres in Tennessee and we have 750,000 acres up in Alaska; an oil platform, production facility and we’re out there reworking previously producing wells, and we’re also finding new oil and gas everyday,” Mr. Gaylor begins.
“What’s even gets better Shelly is that in Alaska, we enjoy the best of both worlds for pricing on both oil and gas. We get Alaska north slope pricing in Alaska, which today I believe is around $108/barrel, and in the Anchorage area where we’re located, there are no pipelines that bring natural gas in, there is no shipping, there is no trucking or anything. They eat what they kill in that area, and there’s a shortage of natural gas in the area, and the spot market for natural gas in Alaska this past winter was $22 nm…it’s a complete disconnect from the lower 48. We can actually execute long term contracts for gas in Alaska at $8 nm for multiyear gas contracts. Unlike any other place in the world I know, we’re getting the highest price for both our oil and our gas. On top of that Shelly, every time I spend $1 in Alaska, I get $0.40 back from the state as an incentive to be there to do oil and gas business. It’s a wonderful environment and Miller is very excited because we spent the last year spending $23 million on a brand new state-of-the-art oil rig that we have put on our offshore platform to do all of our work overs and our new drills, and we spent two and half years to get this point, but the fun’s just begun”, Mr. Gaylor explains.
Bobby and Shelly go on to discuss the company’s operations in Tennessee: “Well, we actually just drilled the first two horizontal Mississippi line wells east of the Mississippi River. Both successfully. We both found virgin oil and virgin gas, and we’re excited about that. Excited to find out where were going to finally produce them at as we get finished up with little projects that we’re doing to complete the wells, but we found fresh oil and fresh gas horizontally. Same stuff they are doing in Oklahoma and Kansas to great results, and we’re excited about it. We’ve got almost a blanket of what we call Fort Payne Oil in our Mississippi line in Tennessee, and we think there is tremendous upside…and I think as we go through the year and we prove up these wells and we start getting some reserve numbers, we’re going to be presently surprised with what that reserve number is going to be.” For more information about Miller Energy Resources, check out their website. SNNLive welcomes Bobby Gaylor from Miller Energy Resources.
Medgenics Website: http://medgenics.com/
Medgenics (NYSE: MDGN) is a clinical-stage biopharmaceutical company developing an innovative and proprietary platform technology – a biological “Biopump” – which allows patients to produce, within their bodies and on a long-term basis, their own natural human protein therapy for the treatment of a range of chronic diseases, such as anemia and hepatitis C. SNNLive spoke with Andrew Pearlman, PhD, President and CEO of Medgenics, Inc. at the 25th Annual ROTH Conference 2013 in Laguna Beach, CA. “Medgenics is developing a way for the patient to be able to make their own drug in their own body using their own skin instead of getting hundreds of injections over a period of months or years; painful injections that have side effects, you can make the protein in your own body yourself, using your own skin, ” Dr. Pearlman begins, “so suppose you have anemia because your kidneys are going, and your coming in weekly to get injections…to try and boost up your red blood cell count. Instead of doing that, you come in for a single treatment that lasts for say 6 months that does it for you. You take a tiny little needle biopsy under local anesthetic of the patient’s skin; the patient goes home. Two weeks time, we process that to become a protein production unit, using your own dermis, half the size of a toothpick needle biopsy, and then we put it back in the body.” When asked how long it lasts, Dr. Pearlman states, “In our clinical trials so far, they’ve last around 6 months on average. You have some patients who’ve lasted as long as 3 years. A single treatment.”
“I think it’s also safer for the patient because every time you inject EPO or any other protein into the patient, the concentration of the blood goes shooting way up above what you actually need. It’s an overdose typically of 100 times what you need, and when you do that, there are healthcare risks, there are side effects. If you can avoid that, but keeping it in the range the whole time, you can reduce side effects and risk. And, after the injection, it runs out very quickly because the half-life in the body is usually only 4-6 hours. So instead, if you’re making it steady in the body, it’s stays in the range the whole time, so you get a better treatment. So it’s both safer, more reliable, more effective, and its less expensive,” Dr. Pearlman explains, “When your cells make your protein, it is your protein. It’s personal. It’s like your own fingerprint. Instead of having a big batch made by rodent cells, which is what they do now, Chinese hampster ovary cells, that are approximately what most patients need, this is your protein; it’s exactly what your body makes, so we believe its safer and it’s going to be more effective.”
Dr. Pearlman was appointed to the Board on February 1, 2000 and is the founder and CEO of Medgenics. He has over 25 years experience founding and managing biotechnology and medical device companies, as well as inventing and developing biomedical technology. Prior to founding Medgenics, Dr. Pearlman founded and served as CEO and chief scientist for TransScan Research & Development Co., Limited, under whose leadership the company’s product, the T-scan 2000 breast impedance scanner, was the first new medical imaging method for cancer detection to receive FDA pre-market approval in over 20 years. He has also founded or co-founded several other companies in the fields of diagnosis and patient monitoring. “This is the beginning of a long story. This is going to be the first of many many treatments that you can do with the same technique. So this is going to be an on-going story over the next decades. We think this will become the standard of care of how you give proteins on a steady basis to people instead of all these injections. I think it’s going to be applied in a lot of different diseases,” Dr. Pearlman concludes. For more information about Medgenics, check out their website. SNNLive welcomes Andrew Pearlman, Ph.D., President and CEO of Medgenics, Inc.
Invictus Global Capital Website: http://invictusipos.com/
Invictus Global Capital Inc. is a privately-held corporate finance and capital markets advisory firm with offices in the British Virgin Islands, Toronto, New York and Zurich. The company specializes in profitable, high growth companies from around the world in high technology and innovation-driven businesses. Their sole purpose is to help finance aggressive growth while creating an optimum liquidity target for founders and early investors. The company advises clients on raising small business capital through going public through an IPO and direct public offering. SNNLive spoke with Philip Brooks, President and Managing Partner at Invictus Global Capital at the International Stock Exchange Executives Emeriti (ISEEE) Conference 2013 in Orlando, FL. “We are very purposely a capital markets and corporate finance consulting firm. We work with investment bankers, and lawyers, and accountants, and market makers, and transfer agents, but our job is to partner with the executive of small to medium enterprise to help them enable themselves to raise money by going public”, Mr. Brooks explains.
“Invictus was designed specifically to assist companies essentially in the $10 million – $100 million revenue range. That’s below the standard investment banking radar so they’re not getting good advisory support. We’re looking for companies that have got a protectable, scalable, competitive advantage uniquely addressing some market paying with their product or service, and a strong track record, and a good management team, and we can help them”, Mr. Brooks states when asked about the Invictus’ ideal clients. He then goes on to say how they can help companies on a global scale: “We are there to assist smaller companies, bridging the accessibility gap and bringing them to the second-most liquid market in the world. There are certain risk profiles available on the NASDAQ that exist no where else on the planet and we do open the doors to the United States to the world any company that fits the description I mentioned earlier, we can help them quite a bit.” For more information about Invictus Global Capital, check out their website. SNNLive welcomes Philip Brooks, President and Managing Director of Invictus Global Capital.