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Company Report
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| Malahat Energy Corporation (NASDAQ OTC:BB: MAHT) |
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Six Month Target Price: $3.75 |
| Shares Outst. (fully diluted) |
15.5 million |
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52-Week Range |
$0.30 - $3.75 |
| Approx. Float |
9.8 million |
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Fiscal Year End |
Jul 31 |
| Insider Holdings |
37% |
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| *TECHNICAL OPINION - Malahat Energy Corp. (MAHT) - 04/01/2002 |
Daily Opinion: BUY
Monday's Bullish (up) move, forming a recent low, is accompanied by huge volume (529% of average), suggesting a continuation higher on the next day. Monday's gap up in price suggests further new highs are ahead. This is an extremely bullish sign. Sometimes a stock will pause, or retrace for a few days to fill the gap, before continuing higher.
Short-Term Opinion: OUTPERFORM
On a short-term technical basis, the trend is Bullish (up) and the stock is slightly above its 50-day moving average at 0.52 which also confirms its Bullish (up) trend. The stock is neutral according to the Stochastic indicator (46.77).
Long Term Opinion: N/A
Not enough data for Long-Term Analysis.
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| A Few Reasons to Consider MAHT: |
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The US Dept of Agriculture reflects statistics of $140 Billion US Market for both food and non-food greenhouse industry |
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Written interests from greenhouse growers in North America for an initial 40 units, which may generate projected revenue flow in excess of $10 mil annually |
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$6 million energy lease program with Alliance Financing for its leasing business model to accelerate installations and monthly revenue stream from energy usage |
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Government backed technology with no "market ready" competitors in its field with its business model |
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Initial launch of its commercial units should produce an escalated ramp-up of monthly revenue stream, with high gross margins |
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Proven technology with successful customer installation and initial commercialization phase |
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MAHT's BioFuel helps reduce wood waste and organic wastes that go into landfills which create methane and other harmful gases to the environment |
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| About Malahat Energy Corporation |
| Malahat Energy Corporation delivers a replacement for fossil fuel that can be used to generate thermal or electrical energy for a fraction of the prevailing market prices. This is accomplished using the Company's proprietary BioFuel system that converts biomass waste. MAHT is a development stage company that has completed its research and development with respect to its M500 BioFuel system and is launching its commercial units for the M500 BioFuel systems in the greenhouse industry.
MAHT's BioFuel system embodies cheap, clean and flexible micropower. The initial focus for the MEC BioFuel system is in the greenhouse industry. Various agricultural and horticultural operations in North America have committed to utilizing Malahat's M500 BioFuel system. The M500 BioFuel system can provide multiple applications on a global scale.
The M500 is the first in the M-Series of gas reformers that Malahat has designed and developed to convert biomass waste materials (such as wood) into a useable, synthetic fuel gas. The M500 has a capacity of up to 500 pounds of feedstock per hour. It produces 2.9 gigajoules (GJ) per hour, gross output. It also produces sufficient fuel to generate 200 kilowatts (KW) of electricity while displacing 90% of the diesel fuel normally used when co-fired in a standard diesel engine genset.
Malahat's M500 BioFuel systems are leased by the Company to its customers for their use to generate and consume energy, be it heat, power or carbon dioxide enrichment for their crops. Malahat charges installation fees along with a monthly fee for the BioFuel system. Each M500 BioFuel system represents a revenue recurring asset of Malahat. |
| Valuation and Conclusion |
Valuation
MAHT's initial focus will be in the greenhouse industry with its 14,000
greenhouses. It is estimated that greenhouse growers could cut their energy prices by as much as HALF by utilizing MAHT's technology.
Americans spend $600 BILLION annually on energy. MAHT estimates that its technology can provide energy that is up to 50% cheaper than current natural gas derived energy. NOW THAT'S SIGNIFICANT! The best part is that MAHT is turning garbage into energy.
Within the alternate energy sector, there are nine companies with annual sales between $0 Million to $35 Million. The average price to sales ratio of these companies is over 20X (times). Estimated annual revenue for MAHT based upon existing lease commitments is $10,350,000.
When taking a closer look at some of these nine companies, three in particular stick out. Take a look at HPOW, PLUG, and MCEL. HPOW has trailing twelve month revenue (TTM) of $ 2.5 Million, and market cap of $141 Million, PLUG has TTM revenues of $6 Million, and a market cap of $538 Million, and last but not least, MCEL has TTM revenues of $"0" Million and a market cap of $116 Million.
Granted, all three companies may be more mature and mainstream than MAHT. All three trade on Nasdaq, and have huge following’s in Yahoo Chats, but at the end of the day, in our opinion all three are basically development stage companies.
Conclusion
Based on MAHT’s estimated revenues of $ 10 Million Dollars, if over the next 6 month’s MAHT were to trade in the market place at a 75% discount to its peers on a Price/Sales ratio (which would be 5 times), then this would equate to a Market Cap of $ 50 Million Dollars or $ 3.50 per share.
Based on the fact that MAHT has a 52 week high of $3.75, which was achieved almost 1 year ago, in our opinion, MAHT is more mature as a company ready to deliver revenues to the market. It is not unreasonable to believe that if MAHT were to become more mainstream as the companies listed above, and were to deliver revenues, that MAHT stock price could trade back to its previous 52 week high of $3.75 per share.
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*Source: The Wall Street Analyst on buysellorhold.com
******* Important Notice and Disclaimer: Please Read *******
Investor Insights (II) publishes reports providing information on selected companies that II believes has investment potential. II is not a registered investment advisor or broker-dealer. This report is provided as an information service only, and the statements and opinions in this report should not be construed as an offer or solicitation to buy or sell any security. II accepts no liability for any loss arising from an investor's reliance on or use of this report. An investment in MAHT is considered to be highly speculative and should not be considered unless a person can afford a complete loss of investment. II has been hired by a third party consultant, and is contracted to receive 150,000 free trading shares of common stock for the publication and circulation of this report. II intends to sell all or a portion of the of the MAHT stock at or about the time of publication of this report. Subsequently II may buy or sell shares of MAHT stock in the open market. This report contains forward-looking statements, which involve risks, and uncertainties that may cause actual results to differ materially from those set forth in the forward-looking statements. For further details concerning these risks and uncertainties, see the SEC filings of MAHT including the company's most recent annual and quarterly reports. |
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