Subjective view of NNLX (prt 1)

I thought it might be entertaining for a long time NNLX investor/speculator to share a subjective view of NNLX. This is intended as neither pro nor con. No facts will be shared that haven’t been already been shared. If you want to read the pro-NNLX story then I suggest reading some of Machiavelli’s posts. If you want to know why to stay away then read the non-stop anti-NNLX posts of the other message boards.

Personal NNLX history – got into NNLX back in the Welch’s gas production days. I was attracted by the possibility of holding a position of a company that might really be able to create natural gas and at the same time break down organic waste. So I dipped a toe in. Never was a huge stock holder, but held a few thousand shares. I fully realized that it was a speculative rather than a normal type of investor action. Most of the shares were bought <$0.10. I knew they were having problems getting good yields of gas, but thought they may be able to work out the kinks. I monitored the message boards when Bret Barnhizer was a regular poster. There was a run-up in the stock price and sold 90% of my position in the low $0.20s and high $0.10s. I held a small position for a couple of years and continued monitoring the company through the management coup that resulted in Barnhizer’s ascension to CEO.

When the clean room was being built there were several communications that implied that customers were ready to place significant orders once the production facilities were completed. I thought, “Wow! There really could be something to this!” Barnhizer was pivoting the company from a gas-from-garbage model to a diagnostic-petri-dish company. The company was trying to capitalize on a “build a better mouse-trap” model and it already had the better mouse-trap! Several posters would provide fantastical models of market share, pps, dividends – you name it. Barnhizer seemed to be accomplishing this while placing the company relatively immune to a hostile takeover (i.e. the poison pill) and keeping the company from mountains of debt. He seemed to be a hands-on guy who was actually personally involved in creating the clean room. I was impressed.

So I got in at a much more significant level when PPS was in the $0.40s to $0.50s. When the clean room was completed and the PPS soared above a $1.00 I was salivating. I thought: “Where is this going once NNLX confirms that large orders have been placed on the company?” Since it had been implied that the orders were waiting for the completion of the clean room, I did not sell a share of stock. I could easily see how this might get caught up in a tsunami of unwarranted optimism if it was followed-up by announcements of large sales. NNLX could easily go to $4.00 or higher.

I did sell a few shares in the $0.80s when it slid back down. I bought back in the $0.30 to $0.50 range.

I had another significant surge of adrenaline when NNLX announced confirmation that they did not need FDA approval because this was diagnostic in nature and simply an improvement on already accepted petri-dish based procedures. They were now fully free to sell to the open market. I thought: “Hold on to your hat – here we go!”

Since then I have made small sales when it goes up and larger buys when it has gone down. Now have a fairly large holding (not the million’s of shares reported by some posters), and am significantly under water. Ouch!